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September
06
2022

Are Stocks About to Crash
Graham Summers, MBA

As I warned yesterday, the next crisis is just around the corner.

By quick way of review…

1) The Fed takes its cues on where rates need to be from the yield on the 2-Year U.S. Treasury.

2) Throughout the first half of 2022, the yield on the 2-Year U.S. Treasury has spiked, resulting in the Fed being WAAAAAY behind the curve in terms of inflation.

3) Only once the Fed began raising rates by 0.75% did the yield on the 2-Year U.S. Treasury begin to stabilize.

Why does all of this matter?

Because stocks are priced based on Treasury yields. So, when the yield on the 2-Year U.S. Treasury spiked earlier this year, the stock market took it on the chin.

Indeed, it was the fact that the yield on the 2-Year U.S. Treasury had stabilized that allowed the stock market to rally this summer.

Then came the Fed’s monster screw up.

In July, Fed Chair Jerome Powell claimed the Fed is “in the range of neutral” as far as monetary policy is concerned. This is akin to him stating, “we’re done tightening monetary policy.”

It was arguably the stupidest thing a Fed Chair has said since Ben Bernanke stated that “subprime is contained” in 2007. And the bond market just called the Fed’s bluff.

The yield on the 2-Year U.S. Treasury has just broken to new highs. This represents the bond market telling us that it no longer believes that the Fed is serious about tackling inflation. The Fed either needs to get WAY more aggressive with monetary policy (bad for stocks) or inflation is going to collapse the economy (even worse for stocks).

Put simply… stocks are on borrowed time. And the markets know it!

If you’re looking to prepare and profit from this mess, our Stock Market Crash Survival Guide can show you how.

We made 100 copies available to the general public.

As I write this there are 18 left.

To pick up your FREE copy, swing by:

https://phoenixcapitalmarketing.com/stockmarketcrash.html

Graham Summers, MBA is Chief Market Strategist for Phoenix Capital Research, an investment research firm based in the Washington DC-metro area.

Graham’s sterling track record and history of major predictions has made him one of the most sought after investment analysts in the world. He is one of only 20 experts in the world who are on record as predicting the 2008 Crash. Since then he has accurately predicted the EU Meltdown of 2011-2012 (locking in 73 consecutive winners during this period), Gold’s rise to $2,000 per ounce (and subsequent collapse), China’s market crash and more.

His views on business and investing has been featured in RollingStone magazine, The New York Post, CNN Money, Crain’s New York Business, the National Review, Thomson Reuters, the Fox Business, and more. His commentary is regularly featured on ZeroHedge and other online investment outlets.

 

 

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