I am an independent voter, I support the US Constitution. Democracy is based on power comes from the people, not a single individual. With that said if we choose to end democracy, I will not stand in the way of the will of the people.
Dramatic? Ill check back in 2028.
If Trump wins, America will be torn to shreds by 2028.
Buckle up.
https://youtube.com/watch?v=BP6_cI5UUZg&si=AVTVuVxG9VahED0v
Using the history of Bitcoin as a guide, it will continue to go higher up towards $1 Million a coin.
There are events that can change this trajectory, such as a "new better bitcoin". One potential is the FED releasing USD blockchain.
How can you tell if the trend is dead?
There is a bitcoin "power law theory" that illustrates the price of bitcoin over the last 15 years:
https://giovannisantostasi.medium.com/the-bitcoin-power-law-theory-962dfaf99ee9
According to this graph between mid 2025 and end of 2025 we should see a near term peak of bitcoin of ~$150K, with a pullback to ~$95K.
If you see bitcoin break below the red line, I expect bitcoin to enter a freefall, simply because big money will be watching the bitcoin trend over the last 15 years and recognize something has changed.
https://charts.bitbo.io/long-term-power-law/
Based on this, it is reasonable to consider selling a coin in the blow off into 2025, maybe ~$145k.
Good luck!
The market is at all time highs, and its anyone's guess if this continues into next year. With the world printing cash, the cash must flow to assets. And right now, USA is the best place for assets in a world having challenges.
This does not mean average Americans are being prosperous. It means loose cash finds whatever the world thinks is a safe investment. When the loose cash ends or people panic, no one can predict exact timing. But it will end in 2025 (if not sooner).
When it does, fear will take over hard core, and US bond rates should plummet. When this happens it will be the LAST time you see rates this low easily for a decade. Ideally move out of bonds into energy, commodities, gold, bitcoin, even oil. Can also invest in technology such as AI or biotech.
What could change my outlook? Average Americans having lower costs, gainfully employed, paying down debts, and growth in consumerism. Without this mix, we will all struggle to keep things afloat.
I do think after this crash we may see inflation in the decade ahead balloon as the world prints its way out of debt, and its obligations to baby boomers.
Buckle up! Enjoy this stock market, for it won't be the same ever again. Easy money days are almost over.
My last post asserted SPX hitting 4900, it hit 5120. This is a prime example when you are right, but yet still wrong. This is what the market is excellent on doing. We did get a market decline and rally into the election as I asserted.
But what I did not get is a decline to the target I thought. Lesson is always trade out of positions when you are right, and don't wait until perfectly right.
I did close out of short positions, in the case of shorting Stellantis, it all worked out well. But for SPX, I let quite a bit go back.
Looking ahead, while the market should be topping, I am reserving this from a declaration. The reason is China is printing printing printing. With loose money it will flow to whatever it thinks is a good investment. I expect gold, bitcoin, and potentially the US stock market to benefit. The reasoning is China's economy is a disaster, I question if the CCP will be in control by 2030.
Worse yet, we will likely get inflation in the USA, and the world, because of the Chinese printing flowing into hard assets. Also Russia is attacking Ukraine international grain ships that will result in less world wheat. These two items will force the FED to not cut rates, ensuring our economy doesn't get the support it needs. I suspect the FED will know this and will ease in "different ways", like its special operations. The interest rate lever is used to pretend it is the master controller of inflation, and while a component, it is hardly the largest one.
If assets do rise, the US pundits will use this to confirm the US economy is doing great. Far from it. The housing market is turning bearish (click). And I personally know multiple people unemployed, some over a year in IT. There isn't a crazy amount of layoffs, companies are simply hiring at a minimal level. This is the first step to having an employment problem as the unemployed accumulate.
Where does that leave us? With China printing we may get another goose up. If it does Bitcoin & Gold is a good play, and the market. Stay into the market going up, but if you get concerned listen to your gut and capture gains. There is nothing wrong with sitting on a portion of your cash in fixed and sit watching into Q2 next year IMO.
We didnt reach the low into the election, when things hit below spx 5000 i will cover most things.
So if you are long in the next week or two, be prepared for some pain. Ill join you as a short term bull soon.
We just experienced a counter rally, going down or up is never in a straight line.
When the FED started to raise rates in March 2022. At that time the Fed said it takes time , over 12 months before the effect of raising rates can cool down the economy. The Fed raised incrementally rates from March 2022 to July 2023. The overnight rate went from 0.25 to 5.5%
Since July 2023 the stock market has reached new highs and bond rates have actually fallen.
The stock market had issues at the same time Japan had issues last Friday into this past Monday.
Now the market is calling for the Fed to cut. Does anyone doubt the fed will cut if unemployment rises or the stock market destabilizes?
While its possible they don't cut, even the Fed set expectations they will in September. What is the rate we are talking about? Its the rate the Fed will pay some financial institutions to deposit their cash with the fed at a set annual rate on a nightly basis.
Notice, this is NOT the 1/2/3/5/7 year, 10 year, 20 year, or 30 year US bond rate. It is not car loan, credit card, or mortgage rates. So a rate cut of the fed rate doesn't automatically cut borrowing costs.
It took 2 years from March 2022 first cut to have material inflation decline about March 2024. Why do people think reducing rates by 0.25 or .5 from 5.5 to 5.0 will positively impact the economy quickly?
It can't because what the Fed rate does is influence financial institutions to seek gains from different financial activity instead of parking cash at the Fed. When banks and other institutions change their investment strategy it takes TIME.
Therefore it isn't possible for a fed rate cut to 'save the economy'. There are potential other events that will give a really good boost for a bit even if unemployment continues to rise. But barring dramatic events, the dice is cast, the market has peaked.
Could we see a new high in the next couple of months, of course. But when the Fed does cut rates, its them saying "we see the economy has taken a turn for the worse", and their action will start to help the real economy, in a year or two.
Now for other potential bad events, last week the reason the US market tanked was Japan had material challenges in their economy, including their stock market falling over 10% in a day, and the Yen appreciating dramatically. This hurt US financial institutions using Japan as a "safe place to borrow money cheaply and use it to invest in USA or world". A shift of rate hikes, Yen appreciation, and Japan market decline basically forced financial institution borrowers to liquidate assets to have enough cash to cover the shift.
This is NOT the last major event, it is the first. Think January 2008 when US market dislocated on a Monday. Its a warning shot.
What to do? Secure assets in financial institutions that explicitly state FDIC insured up to 100K, or buy TLT ETF.
When the Fed cuts, beware of long duration bonds as I expect markets to have long term rates rise in anticipation this next round of Fed Rate cuts will be followed by even higher hikes to tame inflation again.
If you can remain financially well of, I do expect investments of a lifetime available in 2026-2030 that will be the rocket ride of a lifetime with AI bringing in profits.
Good luck!
Hello! Its been a while since I posted. I sold all my crypto a few weeks ago except my core bitcoin. I lightened up on longs (not that I had much!) a few weeks ago too.
Now the market is correcting. I will be exiting my shorter term puts between here and S&P 500 between 4,800-5,000.
I really doubt we will see a 2008 crash. I do think we will see insane swings in the market, with an overall trend down. The market is opening up insanely down today, and we could get more.
But when the S&P500 is below 5,000 its getting a little over-sold on such a short term.
In the chart below is the SPY, and we will see the 50 day moving average hit at between 4,800-5000 depending on the day in the weeks ahead.
I do expect August as a month to be DOWN, so I am not talking a meaningful bottom here.
My goal will be to roll over puts dated 2025 to 2026 and hold.
Overall, safest is 1-5 year US bonds and/or investments in core companies you think are worth it for 10 years. I do think the next 5 years will not be great for the stock market, but I do think eventually AI will be explosive. Its just a little too soon just like 2000 with the internet.
Good luck.
