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No matter how bad the COVID-19 pandemic becomes, there will be an "other side" to get to. Chopped-down interest rates and the flood of pandemic money being brought to bear will eventually ignite a "new bull market" once the coronavirus crisis eases.
In the meantime, savvy investors will be able to profit from targeted trades and strategic stock investments – with superb payoffs, says D.R. Barton, Jr., a veteran investor and trader who runs the Straight-Up Profits advisory here at Money Map Press – and who also wrote the best-seller "The 10-Minute Millionaire."
"There's just too much capital not to have an impact – and a big one," D.R. said in a talk early this week. "Now, it won't be a repeat of the 11-year bull market we had from 2009 to 2020. But there will be an 'eruption.' To the upside. It's still too early to say what form, or what duration. Once it gets started, I could see a bull market that runs for a couple of years – from perhaps 18 months on the low end to a two-year to three-year run that takes us back to previous highs."
In an interview with Money Map Press Founding Editor Bill Patalon, who also runs the Private Briefing newsletter here, D.R. detailed his "insider's view" of the coronavirus-pandemic crisis. He shared:
- The one trading strategy he believes will deliver the biggest profits right now.
- The best way to restart your investing program.
- His predictions of "what comes next."
- The "signals" to watch for that will indicate progress in fighting the virus pandemic.
A "30,000-ft. View" of the Pandemic
William Patalon III: Let's just jump right into this, D.R. And let's get started with your high-level/high-altitude view.
Weeks into this mess, we're still seeing stridently divergent viewpoints. But having worked so closely with you over these last five years or so, I'm interested in what you think.
What does this all look like from, say, 30,000 feet?
D.R. Barton, Jr.: That's a good way to put it, Bill – a view from 30,000 feet. And that view, in my estimation, is concerning. There's a huge "Reality Gap" still – and it's widening. At one extreme are the bulls. They said last week was the bottom and that stock prices will head up from there.
At the other extreme are the bears – the fearmongers – the people who are saying 150 million will die worldwide.
So here it is – you've got these two, extreme conflicting forces, with little agreement in the middle. And that's been causing tremendous confusion.
This new stance from Washington – a relaxation on the whole "back to reality by Easter" was a step in the right direction. Because there's just no way that's going to happen – the "real" reality is that there's still some really bad news to come.
WPIII: Okay, well let's get back to the stimulus – which is where we started this talk. Is that part of this "bad news?"
DRB: Not at all.
Before we talk about this stimulus program, let's get a bit of perspective, and compare it with others in recent history – specifically, the one in the late fall of 2008 and spring of 2009, followed by the outlays we saw in September/October of 2011.
Remember, in the 2008/2009 stretch – amid the mortgage meltdown – that stocks went into a free fall. Then remember how strong stocks rebounded after TARP (the Troubled Assets Relief Program), and the rounds of quantitative easing.
That was followed by the stretch in 2011, which started with two big market drops in early August 2011, when S&P downgraded the U.S. debt rating – at the same time we were dealing with the European debt crisis. Big losses in September capped off a quarter where the S&P 500 dropped 14%. More quantitative easing followed, and the S&P 500 soared 11% that October.
This latter case was backdropped by a pretty robust economy – as was true before the coronavirus pandemic reached U.S. shores.
WPIII: But you're not anticipating that kind of big bounce-back here, are you?
DRB: The longer-term outlook isn't bleak. But I don't see a similar bounce-back in the near term. I don't think we've seen the worst of this – not by a longshot.
I suspect we've yet to see the big numbers I'm anticipating from India, Bangladesh, and Indonesia.
Stocks will find a true, lower bottom – by virtue of a true "capitulation" on the part of investors.
We haven't seen that yet.
WPIII: So despite what some bullish traders are saying, the historically steep sell-off we saw over the past month wasn't a capitulation move? That wasn't the bottom? And traders who are saying the rebound is the start of a new upward leg are not correct?