Quote:
Originally Posted by BE911SC
It's the end of an eight-year presidential cycle. The last two times that happened there was an economic downturn. Maybe nothing will happen but keep a close eye on the market. If it starts heading down in the next 30-60 days we may be seeing our third consecutive downturn at the end of an eight-year presidency.
Wall Street gets out first, slowly and quietly. Then the other players see the trend and the herd becomes nervous and starts looking around for an answer. Then the trend accelerates and the herd starts moving. Then the herd finally sees the threat and explodes in every direction in sheer panic. When the dust settles the top Wall Street firms are smiling like the Cheshire Cat while everyone else wonders what the hell just happened. Again.
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What was the commonality of events that caused the downturn that you mentioned in the last two 8 year election sequences?
Both in 2000 and 2008 Bubble economies deflated. The first was the Dot Com bubble the second the RE & mortgage bubble. The bubble that is currently building is the Mother of all bubbles and that is the Sovereign Debt Bubble. There is no walking away from an implosion of that bubble for it has to do with the very medium of exchange for the Global economy...the USD. The ramifications of a USD collapse would be like a nuclear war without the bombs.
What most do not realize is that since 2008 a whole new paradigm of reality has been operative. The old rules no longer apply as the FED now has a safety net guarantee of activism to support the economy from failing. That guarantee has been the lynchpin of the advance in Equities since 2012.
As it is turning out without FED intervention the economy falters into a no growth mode(even with intervention it is slow growth at the rate of population increase). This is unsustainable because tax revenues will not keep up with government expenditures in particular SS, Medicare and Prescription Drugs. Thus you are in effect standing on the deck of the Titanic.