On the heels of today’s ridiculous propaganda coming out of the Federal Reserve about how it is going to reduce its balance sheet, it appears the cocaine high is coming to an end. This is what it will mean for investors.
The cocaine high is coming to an end
On the heels of the Fed release, Peter Boockvar issued this warning: I reiterate my view that just as QE created much ebullience in markets, QT will do the opposite. While it won’t be symmetrical because of the gradual start to QT, everyone has to remember that the 3rd mandate and purpose of QE was higher stock prices. Thus, I believe it’s delusional to think there won’t be a negative impact on asset prices as the reverse happens…
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To hike or not to hike…
Boockvar had this to say regarding the odds of a December Fed rate hike: As for the December rate hike, it is happening if the S&P 500 handles QT in a smooth way in coming months. Thus, we either rally ourselves into another rate hike or sell off away from one.
About the gold market…
Here is SentimenTrader’s latest update on the gold market: There was a rush into some of the gold ETFs heading into last week, and since then, the metal has declined steadily. It has been a steady decline, without much emotion, and the Optimism Index for GLD and miner funds like GDX are still above the pessimistic zone. The Risk Level has come down from the 9 it was at earlier this month and is now neutral. There isn’t anything compelling I’m seeing yet that would prompt a change in exposure.
The commentary directly above is from SentimenTrader. To try a free 14-day trial of the internationally acclaimed work that Jason Goepfert produces at SentimenTrader simply CLICK HERE.
***KWN has now released the remarkable audio interview with Gerald Celente covering gold, silver, the wild trading in Bitcoin, increased fears about North Korea, and much more CLICK HERE OR ON THE IMAGE BELOW.
***ALSO JUST RELEASED: John Embry – The Charade Is About To End And The Implications For The Public Are Horrifying CLICK HERE.
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