Start the conversation
Thanks for keeping the great comments and questions rolling in.
Well, most of them are great.
Spoiler alert: I can't fix your broken phone, and I really am "that ignorant."
But I was able to field some excellent questions about what happens to all the money from Trump's tax cuts, whether the Fed will really raid private bank accounts, and the myth that you "can't time the markets."
I hope you enjoy reading these as much as I enjoyed answering them – and please, drop me a line in the comments section. You may very well be featured in our next issue.
Chriss Street, Oct. 12, 2017: Lee Adler should be lauded for a terrific analysis. Momentum moves in big waves and there is still some "Mo" in the system. But over time, the fundamentals will catch up, and the optimists will find that the tide went out and left them on the sand.
Lee: Hi, Chriss. First, thank you for the kind words. That goes for everyone who has written a supportive comment. I deeply appreciate that. I'm here to help people preserve and grow their capital. I'm really glad you appreciate the work, and it's always nice when that feedback comes through in positive comments. Thank you, everyone, for your warm welcome and good wishes!
You have a great point here about momentum. I'm both a liquidity analyst and a technical analyst. The TA came first. Ultimately TA is the only way to fine-tune timing, and timing really is everything. You can be right as rain on the fundamentals, and you can truly believe that the market will crash, and you may ultimately be right about that. But what the fundamentals tell us should be so is not reality. Reality is "the tape," which is another way of saying the "price trend."
It all comes back to Rule No. 1 ("don't fight the Fed") and Rule No. 2 ("the trend is your friend"). In other words: "Don't fight the tape." We are at the point now where the Fed has blatantly told us that it is draining funds from the system and will do so at an increasing pace in the months ahead. If you are still buying stocks now, you are fighting the Fed.
However, as long as Rule No. 2 is in effect, buying stocks now isn't so bad. But you are playing with fire, picking up nickels in front of a steamroller.
My technical work is showing that a transition is probably underway. For the first time since I started the Daily Trades List, there are now more shorts than longs. Longs have been taken out as trailing stops got hit, and my pattern recognition algorithm has been recognizing more and more short patterns lately. Some have begun to move in the right direction very quickly.
The time is at hand when the broad market averages will stop making new highs regularly. Then, in a few months, the market will start making new minor lows. That is how bear markets begin. By the time the media tells you that it's a bear market when the Dow is down 20%, many stocks will be down 30% to 40%, and it will be too damn late to do anything about it. The time to act is NOW.
Martin Kinnaman, Oct. 4, 2017: Any discussion about politics or international politics/policy that does not include the world central banking scam as a variable is a moot point discussion. To not include that 800-pound gorilla in the room as a variable requires a level of disconnect with the obvious or complicity. I don't know you, Lee. Are you really that ignorant or…?
Lee: Hi, Martin. While your point is made somewhat indelicately, I get it. In fact, I do cover foreign central banks in some depth in the Wall Street Examiner Liquidity Trader Pro. And I have definitely opined on it occasionally here and at Sure Money. Here's the latest post including a look at the ECB.
As to whether I am ignorant or not, I will leave that judgment up to you and other readers.
Shanna Y, Oct. 13, 2017 at 3:42 a.m.: Checking in my phone does not work. Probably it's being compromised.
Lee: Hi, Shanna, I'm sorry. The number you are calling is not in service.
Hannes, Sept. 23, 2017: In the case of President Trump succeeding with the tax cuts, will the "trillion USD" that apparently becomes available then just increase this "pool" again? Your articles are great.
About the Author
Financial Analyst, 50-year charting expert, finance + real estate pro, and market analyst; published and edited the Wall Street Examiner since 2000.