The Bull Market of 1932-2018

This wont take long: stock owners should be aware that the U.S. stock market is now in  the process of coming to a catastrophic end. Rising hundreds of points day after day turns an investment arena into a gambling den with no regard for sanity or value. A couple of weeks ago, the extent of the radical part of the advance, known as a “throw over,” looked similar to the final run up into the 1929 top, which reversed violently, cutting the market in half in days and, after a countertrend rally into early 1930, collapsed, ending in an 89% loss in the value of the Dow Jones Industrial Average.

Now, the shape of this run up is starting to look like the South Sea Bubble in the early 1700s. I will not be surprised if the market shoots up another two thousand points in just a few days. There is a valid Elliott Wave projection of 28,272 in Dow Jones Average. This is probabilistic, of course, not necessarily a firm target.

At this point, based on my studies, I allow for an acceleration in the rise, but fully expect that the top will be sudden and the reversal to be extremely violent. I do not think the reversal is very far out in time.

Who will be affected? Everyone who has stocks in retirement accounts or who will be depending on state and city government employee pension plans first. Later, businesses, professional practices, real estate investors and, well, everyone you know.

It is definitely a time to head into the bunkers. I believe that cash is the only thing to hold in investment accounts at a time like this.

Rod

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