VRA Must Read: If the Market Crashes, The FED Will Have Blood on Their Hands
/Sep 09, 2015
VRA Must Read: If the Market Crashes, The FED Will Have Blood on Their Hands
Must Read for All Active Investors...For These Two Reasons:
1) If the Market Crashes, the FED Will Have Blood on Their Hands
2) Regardless of What Happens, THIS is the Exact Environment the VRA Was Made For...We'll Continue to Beat the Markets Handily Either Way
I'll Explain Both (briefly) Below:
First, make NO mistake about this; there's only ONE reason that the stock market...both in the US and globally...is dropping 3% one day, rising 3% the next day, and then dropping 2% the next day. That reason is THE FEDERAL RESERVE, led by her highness, Janet Yellen.
As I wrote this morning, I see NO WAY that the FED can raise rates in this environment....NO ONE IN THEIR RIGHT MIND SEES ANY WAY THE FED CAN RAISE RATES IN THIS ENVIRONMENT!
Consider:
Following stability in global markets on Monday and Tuesday, US markets had a very strong and stable Tuesday here, ending with nearly 400 points in Dow Jones gains.
That was followed by massive gains in Asia overnight, then in Europe this morning, and finally with a strong US opening in stocks here of close to 200 points.
Finally...stability and resolution seemed on its way...normality was returning. But that all changed with an obscure economic report at mid-day today...the JOLT report showed that job openings had reached a multi-year high here in the states, and once again, the FED's lack of clarity seemed to open the door to an actual rate rise at the end of next week. US markets reversed course promptly, from gains of 1% to Dow losses of 240 points by the close. Does anyone actually want to risk their hard earned money in this kind of risk filled environment?? Not no, but HELL NO. And they wonder why the individual investor is leaving the market in droves...
I'm willing to give this FED a "bit" of room to run...but only because they have not actually acted to increase interest rates. However, should they act next week, and raise rates for the first time in more than 9 years, no one should be surprised if the markets crash...because that could very quickly become our global reality.
Having said this, I still see NO WAY that the FED will raise rates. But here's what I have no clue of; why haven't they already announced that a rate increase is off the table?? It's exactly what they "should" do...not only would the markets have instant stability, but if they took the further step to then say that no rate increase would take place until 2016, both stock markets globally...but more importantly, economic situations globally....would be able to find their footing and put to rest this central bank fed insanity.
Will the FED take these actions? Of course not. Why not? Incredibly, because these high profile, pseudo masters of the financial universe, have fallen in love with the celebrity of it all.
Second, Regardless of What Happens, THIS is the Exact Environment the VRA Was Made For
Going forward, we may have to be more nimble than most would prefer to be, but know this; it's this exact environment where the VRA shines. Whether the market is rising or falling, we can and will make money in either direction...I can say this with confidence because its exactly what I've done for more than 12 years...and there are thousands of VRA Subscribers that can attest to exactly this. Sure, I would rather make money in a normal, rising environment, but we don't always get what we want...I learned this long ago, along with the perfect strategies to make money in a falling market.
Until next time, stay frosty...we'll be ready regardless
Kip
vraletter.com
