From the recent Ray Dalio's interview with business insider, he pointed out that our current situation looks exactly like in 1937, which led to a recession.
Three points that I take away:
1. Dollar is facing a short squeeze at current phase, so fundamentally, do not short dollar until something changes. So far, the picture is still Fed tightening and ECB, BOJ QEing.
2. The debt bubble will burst, which will end bad and the Fed will come to rescue, that's after when we have the "buy the dip won't work" phase.
3. The rescue will be temporary in my opinion, the fundamental issues of U.S economy, even global economy will have to resolve themselves in a bad manner, causing a recession.
We have experienced the sharp correction like in 1937 (~13%). Now we are in the "struggling to make new highs" phase, so sharp corrections like this week will happen more often, but direction is still up. The economy will use all its power to pump equities for the last chance. After that, we will experience extreme volatility= great money will be made by then (both long and short).
Around late 2019 and early 2020, the U.S may enter into recession. For how long, it all depends on what the monetary and fiscal policies will be at that time. Be prepared for that, but we are not there yet. So treat the pull back as buying opportunity. I have target price for $SPX500USD ~3200 and $US30USD ~28000.
Three points that I take away:
1. Dollar is facing a short squeeze at current phase, so fundamentally, do not short dollar until something changes. So far, the picture is still Fed tightening and ECB, BOJ QEing.
2. The debt bubble will burst, which will end bad and the Fed will come to rescue, that's after when we have the "buy the dip won't work" phase.
3. The rescue will be temporary in my opinion, the fundamental issues of U.S economy, even global economy will have to resolve themselves in a bad manner, causing a recession.
We have experienced the sharp correction like in 1937 (~13%). Now we are in the "struggling to make new highs" phase, so sharp corrections like this week will happen more often, but direction is still up. The economy will use all its power to pump equities for the last chance. After that, we will experience extreme volatility= great money will be made by then (both long and short).
Around late 2019 and early 2020, the U.S may enter into recession. For how long, it all depends on what the monetary and fiscal policies will be at that time. Be prepared for that, but we are not there yet. So treat the pull back as buying opportunity. I have target price for $SPX500USD ~3200 and $US30USD ~28000.
