Every major stock market decline and every recession in the last 100 years was preceded by the Federal Reserve raising short-term interest rates by enough to provide the pin to prick the balloon.
Note the emphasis on every. Yes, there have been periods where the Fed raised rates and a recession didn’t ensue. Everyone knows the famous saying about the stock market having predicted nine of the past five recessions! That may be true, that rising rates don’t necessarily cause a recession. But as an investor, you must be aware that every major stock market decline occurred on the heels of a tightening phase by the Fed. More importantly, there have been no substantive Fed tightening phases that did not end with a stock market decline.
You can read the rest @
https://bonnerandpartners.com/this-has-predicted-every-market-crash-in-history/
Ruh-roh, that doesn't sound good. There go our pension plans. There even is a flow chart from Deutsche Securities which shows how it all works:
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