I know one sure thing about the stock market. Money talks! Mine says goodbye.
Never bet against the FED.
The FED has been backstopping the financial markets since 2008.
The FED has engaged in 2 unprecedented and massive rescues of the financial markets since 2008 with the current one still ongoing.
The FED has bailed out shadow banks, engaged in massive purchases of corporate debt, financial system debt and corporate junk bond debt thus flooded the financial and corporate markets with easy and fee money.
Were it not for the FED's massive intervention in these financial and corporate markets, the markets would have collapsed and a depression would have ensued.
Basically, the FED has instituted a floor on financial markets and their is only way for the markets to go, which is not down because of the FED floor, but up.
It is an illusory market, not constituted by new tangible investments, growing employment, new plants, warehouses, products etc, but by FED fed free money that is being employed by corporations and the financial markets for stock buy backs, issuing low interest rate corporate debt, increased dividends solely for the purpose of not growing the company, but to increase share price, shareholder value and showering the 1% with obscene wealth.
This is not a financial market, but a FED rigged and endorsed financial casino and gaming market.
Fed funds rate and Interest rates declining = markets rising and vice versa.
This low/no interest rate environment has fueled a:
1) A stock market bubble
2) A bond market bubble
3) A housing market bubble
And when interest rates rise, there will be a great whoosh of air deflating the bubbles or a catastrophic eruption of the bubbles.
