They say they don't ring a bell at the top of a stock market cycle. Yet when you look beneath the surface of today's inflated equity multiples, the tolling is becoming impossible to ignore.
The market's central risk isn't a technical chart pattern or a single disappointing quarterly report.
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Oh, the charts show that there's a problem. I'm just calling out what the problem is so that investors and traders can focus on the four key risks I see right now. That way, as they are eventually resolved to the market's satisfaction, a new upcycle can begin.
And based on the history of market sentiment, by then, at lower levels, few will want to hear about it.
Call my views tainted if you want. Tainted by living through multiple market cycles as a then-investment advisor, when clients went from wanting to lever up stock portfolios to asking if CDs were really safe to invest in. You get the point.
The problem right now is one we have not faced in decades, at least not all at the same time. Specifically, basic economic inputs are severely mispriced.
The Four Horsemen
The prices of food, energy, credit, and housing have reached levels that actively drain consumer health an...