Saturday Jan 22, 2022

WLS-AM 890 - January 22, 2022 Volatility, the New Normal?

Episode Thoughts:

  • Stocks have begun to signal widespread investor capitulation as key indices fall below support levels, potentially triggering forced sales.
  • Long-term market and inflation trends indicate lower asset prices as inflationary forces skew the GDP compensation share back toward labor and away from asset owners.
  • Record margin debt and credit card debt combined with low investor cash allocations and reduced personal savings indicate negative retail investor liquidity flows.
  • Weak consumer and business sentiment, falling real incomes, poor Q4 bank earnings, rising initial claims, and China's economic issues point toward an economic downturn.
  • Since supply-side factors support inflation, investors should not expect the Federal Reserve to bail them out again - meaning it could take decades for the stock market to recover if it crashes.

Unless stated otherwise, this is not an offer to sell or a request to buy an interest in any entity or investment vehicle. Any such offer or solicitation will only be made through formal offering materials.

Version: 20240731