February 17, 2017, 4:30pm EST Invest Alongside Billionaires For $297/Qtr
There’s little in the way of economic data next week to move the needle on markets and the economic outlook. With that said, the catalyst will continue to be Trumponomics, and the President said yesterday that we should expect to hear “big things” coming in the next week or two.
As we head into the weekend, let’s take a look at some charts of interest.
The S&P 500 is now up 10% since election day (November 8). For some perspective, since the 2009 bottom, when the global central banks stepped in to pull the world back from the edge of collapse, you can see the trend has been a 45 degree angle UP. And despite all of the fear and pessimism along the way, the sharp corrections along the way were quickly reversed, most of which were completely recovered inside of ONE MONTH.
With central bank policy around the world still promoting higher global asset prices, and with pro-growth policies underway in the U.S., any dip in stocks will be a gift to buy.
We looked at this next chart last week. It’s the inverse price of gold versus the U.S. 10 year yield. You can see they have tracked nicely since the election.
With Yellen’s session on Capitol Hill this week, the yield has whipped around from 2.40 back to 2.50 and back to 2.41 today.
Meanwhile, with the continued hostility surrounding the Trump administration, and accusations about Russian conflicts, gold has been stepping higher. This all looks like higher gold and lower yields coming. As questions arise about the execution of (or speed of execution) growth policies, some of the inflation optimism that has been priced in may begin to soften. That would also lead to a breather for the stock market. In both cases, it would create opportunities — to buy any dip in stocks, and sell any rally in bonds.