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JPMorgan Chase & Co. Message Board

  • sky_walker618 sky_walker618 Jun 25, 2014 3:23 PM Flag

    Missed out the Rally? Do not miss out the crash ......

    This "recovery" is largely driven by appreciation in asset prices. The GDP will be zero or negative once the asset appreciation stops.

    Fed can make the party of asset appreciation going, but it cannot make it going forever.

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    • This is just a small start, an appetizer if you will. Expect 10+% crash day any day now. ;-)))

      Because this is an unusual market in a unusual "recovery", similar to the unusual soccer game between Germany and Brazil. ;-)))

    • Nah. We now can Print success and lock it in with endless ZIRP from the unaudited, opaque, Feckless Fed

    • Expect a 10+% one day drop in major indices. We have not had it for many years.
      It looks like that the market is set up for such big crash.

    • Q2 GDP growth will rebound. There is no doubt about it, given the extreme weather condition in Q1. But what happens after that?
      Even Federal Reserve, in the recent FOMC release, sharply lowered its growth forecast for 2014 to 2%. Walmart came out today saying that the rise in the consumer spending did not translate into rise in same store sales. Where did the extra spending go? Maybe the extra spending can mostly be attributed to well-to-doers who own stocks?
      Growth for 2015 and onward is the major concern for the ruling elite, because without growth, the world's perception on US' ability to pay back its debt will change and US Dollar could be under tremendous pressure. That is why Obama needs to EO the immigration reform probably by Labor Day.
      What happen after that? Only God knows for sure. I say a crash.

    • There is no doubt Q2 2014 will be better than Q1 2014. But how much of that growth would be due to temporary recovery from bad weather, and how much due to the continued appreciation of asset prices.

      But the marginal utility of the same amount of appreciation of asset prices will be smaller and smaller .... Most of Wall Street professionals know this. They will act in time.

    • If the economy is strong, then why the Fed officials constantly have to come to the Media to talk up the market?
      The truth is that the economic growth is heavily dependent on the asset appreciation. If the stock market goes up at 20% annual pace, we would likely see a 3% solid GDP growth. If the stock market levels or starts to fall, then the GDP growth can easily gets to zero or even negative.

      Steady job growth is good, but will it last once the stock appreciation stops? Lower interest rate is good, but does it reflect the expectation of lower growth potential and deflationary pressure?

    • The wolfs on the Wall Street will start to eat each other soon -- animal instinct. ;-))

 
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