Building sand castles is great fun on the beach until an unforeseen wave or wind bluff picks up a grain of sand or two to cause your beautiful monument of creativity to come crashing down forever, right before your very eyes.

The date of ‘the fixer’s’ testimony, also known as Michael Cohen may mark the catalyst for the stock market’s house of cards to take off in a different direction. Markets are most fond of consistency. But when uncertainty and lack of direction take place, it’s not uncommon for markets to search for a floor. Investors have been getting high on optimistic rumors. They are the same people who buy the rumor and sell the news.

Until February 26, 2019, the market has enjoyed 29 positive days out of 41 trading sessions in 2019, opined David Stockman, the same day. It’s the best start to a year since 1987, which is remarkable when investors take into account the collapse of the earnings outlook for the first quarter.

Unless I am mistaken, the forecast for earnings growth in September 2018 was 6.7%.  By year-end 2018 that consensus was down to 3.3%. Today, it’s 1.7%. It could well be negative before we’re done. Yesterday, the “nominal” Institute for Supply Management survey reading that accounts for manufacturing and non-manufacturing has fallen over the past three months. The reading is now 13% lower than when the Great Recession started. It’s 19% lower than it was in February 2000, one month before the tech wreck started.

Now, let’s see how the coming debt ceiling roust plays out live and in color on television. Almost speaking in terms of winds and waves, these aren’t the only “crosscurrents and conflicting signals” Fed Chair Jerome Powell talked about before the Senate Banking Committee on February 25, 2019. As David Stockman, former OMB director, opined on the next day, “There’s also the fact that what we have here is a wheezing, debt-ridden, speculation-saturated 116-month-old ‘recovery’ that has knock me overwritten all over its forehead.

Despite the Fed’s efforts to appease Wall Street, it is liquidating its balance sheet at the annual rate of $600 billion. And with the federal debt now crossing the $22 trillion mark earlier this month, there are compelling signals that there is an abrupt slowdown among China’s principal suppliers, both Japan and South Korea. Let’s see how long this market can withstand the growing headwinds. Enjoy the melt up as you prepare for the melt-down. Now is the time to get ready for the unforeseen in 2019.

Latest Media

The Greatest Economy Ever is Not Happening Now

Whether or not you thought a Fed move on interest rates would greenlight a brilliant move or cause for some improvement on the economic dial, this graph tells the whole story:What you see is an entrenched, self-interested, and Acela Corridor-dominated global elite...

What’s Happening Here? Lack of Sex

“And these are desperate times… Markets are corrupted by monetary central planning. They’re confused. And the road back is going to be treacherous. We’re looking at a major re-pricing for all financial assets. And thousand-point intraday or day-to-day swings are part...

200 N. Westlake Blvd., Suite 109

Westlake Village, California 91362-3783

805.495.2077   800.266.2077   888.WHY.BEPOOR

Fax: 805.497.8342


Securities offered through Securities America, Inc. (SAI), Member FINRA/SIPC. Advisory services offered through Securities America Advisors, Inc. Investors Advantage and SAI are separate entities.

Important Information from FINRA to consider before transferring your account. Trading instructions sent via email may not be honored. Please contact my office at (805) 495-2077 or Securities America, Inc. at 800‐747‐6111 for all buy/sell orders. Please be advised that communications regarding trades in your account are for informational purposes only. You should continue to rely on confirmations and statements received from the custodian(s) of your assets. The text of this communication is confidential and use by any person who is not the intended recipient is prohibited. Any person who receives this communication in error is requested to immediately destroy the text of this communication without copying or further dissemination. Your cooperation is appreciated.

Share This