When the stock market is not going up, the blame game gets played. It’s a combination of shareholders losing money and media types needing something to say. It’s always someone or something’s fault and rarely described as a normal occurrence. The truth, however, is that yes, stocks falling in price is part of the regular cycles that we’ve always seen. In fact, stock markets that don’t have periods of falling prices are incredibly abnormal. 2017 for U.S. Stocks was the exception that proves the rule.
The reason I mention this is because we have not been in an environment where we want to be selling strength since early 2016. Many of you have been following my work for many years and remember my gloom & doom days of 2015 and even as far back as 2008. You guys already know that I’ll be bullish stocks when appropriate and bearish when necessary as well.
It’s important to recognize that the current market behavior is a normal part of this complex system. We don’t have to spend all day making up reasons for it, blaming the fed or the trump or whatever the gossip of the week may be. Looking for who to blame is a completely worthless academic exercise. What does it matter “why” stocks are falling? We won’t know for sure until 6-12 months down the road anyway, if ever. So who cares? [Read more…]
