Lcho07

S&P500 70%-80% Crash - Deflationary Depression

Short
SPCFD:SPX   S&P 500 Index
Due to the printing of money by the fed and interest rates at nearly all time lows (deflation) and the current state of the economy, I believe we are in for a big wake up call... I believe many investors will dump all assets (equities, crypto, commodities , etc..) in return for cash. The US dollar will have a huge rally while this crash is happening. After this deflationary period I believe we will most likely go into a large inflationary period where people will invest in inflation hedge assets like commodities , Bitcoin , etc..

Comments

Most severe corrections, AKA 'crash' give back ~4-6 years of gains. Breaking below 2014/15 price ~2K is unlikely IMO
+4 Reply
J3rry DaddySawbucks
@DaddySawbucks, 1500ish "re-test" would be nice (haha)
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Dont you think the previous double top at 1560 will serve as a resistance?
+1 Reply
Lcho07 willy92wins
@willy92wins, I think that’s too obvious and most people will think that. If the selling pressure is big enough it can blast through that level and liquidate buy orders there.
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@Lcho07 , what is the catalyst?
+1 Reply
unicow kishnara
@kishnara investors would need to decide that returns are higher holding cash than stocks, bonds, and other financial assets. I thought every day this year that investors would realize cash is king because of deteriorating economic indicators, but they’ve plunged along down the risk curve with a sense of cheery optimism and trust in their leaders like Chairman Powell. I don’t anticipate anything being the catalyst until they slam in the wall. I don’t know what that wall is going to be or when they’re going to slam into it. But I hope it’s soon and it’s a very strong wall
+2 Reply
kishnara unicow
@unicow, Thanks. Makes a lot of sense.
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@unicow, interest rates near 0%, how can cash be king ?
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unicow SwissBull
@SwissBull, because bond risk is not being priced in to reflect risk in the source of bond payments—the deteriorating economy. When it’s obvious that bond holders will lose principal, equity and bond markets will reprice and cash will have a higher return than financial assets.
+2 Reply
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