Today, since I’m on the road back to the Rawles Ranch and don’t have much time available for column writing, I’m posting a guest article in lieu of my regular column. It was written by one of my favorite market analysts:
The Fed Is Playing The Biggest Game Of Chicken In History, by Avi Gilburt
(Originally published at the Elliot Wave Technical Analyst, September 21, 2021. Reposted with permision.)
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Yeah, I know everyone is so certain that inflation is what we will be battling for the foreseeable future. The main reason why many of you are so certain we are battling inflation is because you are seeing prices rise on food and other items for which you shop. But, do rising prices really mean we are dealing with the true economic definition of inflation?
To be honest, I really don’t care what you call it. It makes no difference to me since our analysis tells me when to get in and out of the market. You see, I and many others correctly recognize that the stock market leads the economy. So economic definitions have no bearing upon our forward-looking expectations regarding the stock market. And, I have explained why this is the case in past articles:
How To Analyze Market Sentiment Along With Market Fundamentals
Many have vigorously argued with me about this over the past decade during which I have been writing on Seeking Alpha. Yet, none of them have been able to tell you accurately where the market is headed, while we have been quite accurate in our stock market analysis for many years.
In fact, at the time we were bottoming at my target of 2200SPX, a commenter to one of my articles at the time challenged me and suggested that I was 100% wrong in my expectation that the bull market would carry us back to 4000SPX. And, he based his perspective on the “economy.”
He strongly exclaimed that the bull market was dead as it was deeply into bear market territory, and that it was not possible for it to take us to 4000SPX. His argument was that the economy was going to pull the market down a lot further and the 4,000 region was a lot further away than my charts ever suggested. He viewed the market as finally following the economy, from which it was supposedly long divorced according to him. He viewed this as “common sense,” and urged readers to avoid believing that my “chart magic” would take us up to 4000SPX.
Yet, those that have followed my “chart magic” for the last decade know just how well it has performed in the real world, whereas his “common sense” view has been quite misleading and wrong for some time.Continue reading“Economics & Investing For Preppers”
