New High at 7300,is it time for a break? The market has moved 395 points since my last post!
Nq charts
same chart adding GANN
Gann in to Gann---- G+
Thanks, Mike and fayq!
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I often copy some to large parts of articles below the links. This entire article is loaded with so many rock solid points that I strongly agree with, that it justifies reading the entire article not highlighting just the best parts.
The bottom line is that a recession is likely because we are NOT going to defy the laws of economics and math related to the massive uptick in fuel prices and additional inflation its causing which is greatly hurting disposable income.
The rich people's Ponzi Scheme and law of self fulfilling prophesies, otherwise known as the stock market will NOT be able to maintain record high valuations forever, especially if the recession is especially bad with a person in charge that usually makes bad things even worse.
Shilling, known for his persistently bearish views in markets, has cautioned investors about potential recession and a broad decline in stocks for the last four years. Last year, he said the stock drop could be triggered by "extreme speculation" in financial markets, pointing to the hype around AI and crypto in particular.
A persistent bear. If you were out of the market the last 4 years you missed a huge move up.
Excellent comment, cutworm.
I didn't know this about him and did a fact check of the past 5 years that 100% confirmed your statement.
In fact, I was able to go back each year to find bearish statements even farther than 4 years ago.
This article was 5 years ago.
June 17, 2021 at 04:03 PM
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Despite that he has nailed some pretty big predictions in the past.
https://en.wikipedia.org/wiki/Gary_Shilling
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Regardless of that, the reason that I posted that article had nothing to do with the person stating things in it. In fact, I had never heard of Gary Shilling and you obviously knew/know more about him than me.
The entire reason for me to post that article was to emphasize ALL the profoundly powerful points in it.
https://www.marketforum.com/forum/topic/119975/#119988
"I often copy some to large parts of articles below the links. This entire article is loaded with so many rock solid points that I strongly agree with, that it justifies reading the entire article not highlighting just the best parts"
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My thoughts are INDEPENDENT of the sources and I will pick and choose articles that sometimes make points that I disagree with to show why I think they are wrong and articles like this one that I strongly AGREE with to emphasize great points and reasoning.
Even knowing his track record of being a bear in recent years which BUSTED BADLY, I would have still posted the article with the same comments.
What is most different this year is a war that is punishing our economy severely and we've not seen anything yet.
Applying the fundamentals of economic principles and using math, there is almost no way to avoid at least a mild recession right now. The rich person's Ponzi Scheme is incredibly vulnerable.
It may take until 2027 for the oil market to recover completely from this and we are still in the growing/accumulating damage mode!!!!
Cheap, reliable and abundant crude oil is the life blood to every developed countries economy. We have the worst global energy crisis in history. There are 6,000 items we use every day that use petroleum to make them.
I am extremely grateful to you for assisting me to learn something new...........that Gary Shilling has been TOO BEARISH in recent years because of an over valued market that has managed to sustain being over valued for MUCH longer than what he thought.
During that time, the market was not hit like its being hit now with what will be seen, historically as a BLACK SWAN EVENT......... the war in Iran.
https://en.wikipedia.org/wiki/Black_swan_theory
The black swan theory or theory of black swan events is a metaphor that describes an event that comes as a surprise, has a major effect, and is often inappropriately rationalized after the fact with the benefit of hindsight.
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So let's throw out the source of this prediction and use it instead to understand metmike's views on the economy and stock market, MAINLY, FOR ME its because of the impact of the war that will greatly amplify the damage from the tariffs.
I have not been continually bearish(though much more bearish than bullish the last year) and in fact called the stock market bottom in March while totally not thinking the stock market would go up this much this fast. That was a shock-a-roo!
Regardless, none of that really makes a difference on May 3, 2026, whether it's Gary Shilling, metmike or cutworm. What matters is not what somebody did in the past but their ability to RECOGNIZE FRESH fundamental dynamics that will impact the markets in the future.
Again:
1. Cheap, reliable and abundant fossil fuels are the life blood of every developed country‘s economy.
2. We have increased the fuel cost by 50% for land, air and sea.
Economic principles and math!!! RISKS of a global recession are extremely high.
I’m a very longterm mainly passive stocks investor. That means I rarely try to time the ups and downs. After large drops, I do sometimes buy very modestly to average down like I did twice early in 2025, including on Liberation Day.
The only time I ever sold a large portion of my equities (mutual funds in this case) was from an IRA, where most of my equities are located. Because stocks were near all time highs, I felt it was prudent to in mid Jan of 2021 sell 75% of my equities on the fear of major civil unrest near or soon after Biden was to be inaugurated as a follow-up to Jan 6th. I heard about the chatter of MAGA going to all of the state capitols and threaten violence. I was especially worried about Inauguration Day, itself!
As it turned out, nothing much happened thank heavens and thus the market never plunged. Instead it rose some and I was worried the market was going to keep going up with 75% of my equities no longer invested.
But then it fell back and I bought back 2/3 of the previously sold 75% in early Feb and the other 1/3 in early March on small dips and have remained invested since. It turned out that I luckily came out a tiny bit ahead. But I decided then I’d probably never do what I did in mid Jan again due to my passive long term stocks investor philosophy. I felt I needed to leave my speculating to commodities.
I should also clarify that I have a good portion of my assets in other things like savings/MMs and R.E. (mainly my home). So, if the Dow were to plunge, I’d have other assets to live off of so I wouldn’t panic and feel forced to sell stocks at low levels.
By the way, I saw a stat put out by my well known brokerage that after an initial potentially shaken period that stocks 12 months after wars recovered and did well:
Thanks very much!
Nice graph with all the wars And it does show the market recovering from every correction from every cause (many big causes not listed).
However , it completely misses a couple of my points.
1. The impact from this particular war is and will have an order of magnitude greater magnitude than any other war. This war is causing the greatest global energy crisis in history. 20% of the world’s crude oil is being blocked. Some of that has been replaced by global strategic oil reserves but those are running out. People in the US are not understanding the true significance because we aren’t running out . However, crude is a globally traded commodity and this impacts our price. If you want that graph to apply to THIS war, then show us the markets reaction in the past to every time there was an historic energy crisis similar to this one . You need to go back to the 1970s. And in fact, your chart even shows the market did NOT go up in the 1970s. The highs for the that decade were in the early 1970s. The dynamics of the 1970s OPEC oil shock were totally different than this. They were permanent, this is temporary. Regardless, a temporary crisis is still a crisis. A temporary recession from this temporary crisis is REAL!
2. I am not saying that the stock market can’t recover from any drops or corrections, just that all the fundamentals right now are screaming correction from an extremely over valued market, historically. The time to buy is not when something is the most overvalued AND the fundamentals are flashing global recession from a Black Swan Event.
3. Most people have money in the stock market and with that, a mentality that dials in their bullish bias. They may be in it for the long term but are unable to fully embrace the NEGATIVE impact of an historic energy crisis. This is also why we have the law of a self fulfilling prophesy at play.
4. The stock market roaring up and smashing the old highs in the midst of the worst global energy crisis is extremely telling. It shows we are no longer trading economic health. It’s more evidence of the market being the rich people’s Ponzi Scheme. The market knows that Donal d Trump“s top priority is not helping the poor or doing honest things to help most Americans. He has told us himself hundreds of times. His priority is the stock market and doing things for the rich people to make it go higher. He can wreck the economy for most people with tariffs and the worst global energy crisis in history but the huge money flows from the wealthiest Americans see benefits to them because they get most of the weighting for Donald Trumps decision making.
5. There are likely some things that I’m,overlooking. Maybe the market sees Trumps new Fed chairman as pushing for lower interest rates lower, no matter what necause that is the most bullish stock market policy which has been what he has been insisting on this entire term.
6. Consumer confidence had a tiny bump up last month but remains near the lowest since the 2020, Covid damaged year. If these were also the same people that controlled the stock market, the stock market would not be this high. If you want the best metric for a poll telling us where the stock market may be headed, ask the top 5% wealthiest people in the US if they plan to keep putting more and more of their money in the stock market, no matter what.
Donald Trump has yet to appoint somebody that differs from his philosophies. They almost all constantly adulate everything that he says and does. It’s how they got and keep their jobs. Regardless of who they pretended to be at the hearings. I will be shocked if the new Fed chairman is different than all the other Donald Trump appointees……..21 of them that came from Fox News. The point is, the new Fed chairman’s focus is likely going to be more on keeping the stock market up than any other Fed chairmen. This MIGHT explain part of the straight up move the last 7:weeks with a worsening global energy crisis. Despite global recessions becoming almost inevitable in many countries.
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4-30 am. Crude is +$1 right now which is tame by recent standards. I guess we aren’t in a war anymore because Donald Trump declared it………so that he can continue his war LIKE policies indefinitely without getting the approval ,from Congress. Most Rs still back him up, though., despite the MAJORITY of Americans strongly opposing the war and ALL of us, outside of the corrupt military, industrial, political complex getting hurt. Poor people the most.
Thanks, Mike!
Even though lowering int rates has historically been bullish stocks, I hope the new guy doesn’t just mindlessly push for lowering them. I wouldn’t even mind the committee raising them some. Besides that quite possibly being the smart move to combat inflation, MM rates then may bounce some. Maybe the stock mkt may actually be relieved?!? Keep in mind that he’s just the head and that the others also vote independently, which will include Jay Powell since he said he’s going to stay. So, fingers are crossed that this new guy won’t suddenly have enough influence to keep raising rates off the table!
This suggests the head is very powerful unfortunately:
