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March 18, 2025
Short Stock Indices
&
Buy Treasury Bonds
I’m not saying
we’re headed into another Great Recession or Depression (which, btw, also
was partly precipitated by international tariff wars), but do think
statements like the following from the Treasury Secretary will prove to
have been dead wrong regarding what is now happening in the stock market
and the economy…
March 13, 2025 --Treasury Secretary Bessent
said the White House is focused on the ‘real economy’ and not concerned
about ‘a little’ market volatility
…which was not that
different from what other “expert opinions” were saying as the 1929 Crash
was taking place…
Herbert Hoover (U.S. President) – On October
25, 1929 "The fundamental business of the country, that
is production and distribution of commodities, is on a sound and prosperous
basis."
The New York Times - October 30, 1929 – "There
is nothing in the present situation to warrant the destruction of values
that has taken place on the stock exchange during the past few days."
Irving Fisher (Economist, Yale University) – Just
before the crash, on October 16, 1929 --"Stock
prices have reached what looks like a permanently high plateau."
…and also not that different from what the TOP guys in
government were saying right before the 2008 Crash and The Great Recession…
Ben Bernanke (Fed Chairman_ - May 17, 2007 – "We do not expect significant spillovers
from the subprime market to the rest of the economy or to the financial
system."
Henry Paulson (Treasury Secretary) - March 13, 2007 – "I don't see (subprime mortgage market
troubles) imposing a serious problem. I think it's going to be largely
contained."
AND I DON’T THINK
WHAT WE’RE HEARING NOW IS ANY DIFFERENT…
There are headlines like these
everywhere…
 
So let’s be real…Wall Street, as is their NORM,
did NOT see this sell off coming…And neither did anybody at the White
House…and yet, they are all STILL thinking everything is OK…that this is
just a “risk off” period…and oh yeah, that this sell off is “healthy.” This
shit never changes…A month or two from now, and who knows how much lower in
stocks, they’ll all be trying to sound like they “saw it coming.” When they
did NOT…and DON’T now.
FROM WHAT I SEE EVERYHWHERE, THE PRIMARY WALL STREET VIEW IS THAT STOCKS ARE JUST “CORRECTING,” AND ANY FEW
UP DAYS OR WEEKS WILL ONLY REINFORCE THAT IDEA…BUT WHAT I SEE IS A MARKET
THAT IS IN SERIOUS TROUBLE…AND THAT THERE IS STILL HAS A LONG WAY TO GO ON
THE DOWNSIDE…And at
some point soon, I would expect to start seeing some concessions or tariff
downplaying or “We’ve agreed on a deal” conciliatory type messaging start
coming from the White House…but would caution about thinking, “Oh great!
He’s backing off some of the crazy stuff…Now the market can turn back up.”
BUT…as I have written since last fall, I have been seeing the stock market
as being primed for a significant decline, and am now fairly certain that
Trump’s slash, burn and threat approaches to diplomacy, trade, domestic
issues, etc. (and the constant flip flops in each) have been THE catalyst
for finally breaking the back of the markets…and with it consumer
confidence and maybe the economy…to the point where no amount of
backtracking on his part (believe me, he IS watching the market) is going
to turn everything back to the positive…so I CONTINUE TO RECOMMEND SHORTING
THE STOCK INDEX FUTURES…
And I LOVE THE BOND MARKET HERE…
Call if you want to talk about any of this…I’d love to hear what YOU
think.
Thanks,
Bill
770-425-7241
866-578-1001
All
option prices in this newsletter include all fees and commissions. All
charts, unless otherwise noted, are by Aspen Graphics and CRB.
FUTURES
TRADING IS NOT FOR EVERYONE. THE RISK OF LOSS IN TRADING CAN BE
SUBSTANTIAL. THEREFORE, CAREFULLY CONSIDER WHETHER SUCH TRADING IS SUITABLE
FOR YOU IN LIGHT OF YOUR FINANCIAL CONDITION. PAST PERFORMANCE IS NOT
INDICATIVE OF FUTURE RESULTS. THERE IS NO GUARANTEE YOUR TRADING EXPERIENCE
WILL BE SIMILAR TO PAST PERFORMANCE.
The author of this piece currently trades for his own
account and has a financial interest in the following derivative products
mentioned within: Stock Indices, Treasury Bonds
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