Market: the King is naked

Posted: October 10, 2016 in Uncategorized

The US market is starting its 3rd Quarter earning and while the consensus estimate is -2.1% year on year – if the beat the expectation pattern of the last quarter proves correct we could have the first growth from 2015!

And it better be as the tricks of Reserve Banks influences and other manipulations are starting to wane.

The profit growth in the last years has been driven by sub par average wage growth. Now that we  are really reaching full employment – this boost will soon end.

Oil has been a boon as it subdued inflation and allowing the Central Banks to keep interest rates very low, boosting both the stock market and the real estate market.

Many other “lower level” signals indicated that now the market will have to walk by itself.

Also as a note, the second Fed interest rate hike is when, statistically,  the shares usually fall the most – the market could easily follow the example of gold.

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