IanSinclaire

How is it possible that the DJIA loses 90% of it's value? ...

Short
CBOT_MINI:YM1!   E-mini Dow Jones ($5) Futures
"It is very simple, really. First, it loses 50% of it's value and then, 80% of the remainder." - Answered Benjamin Graham, to a reporter, in a 1934 interview.
Comment: Two simple facts;

1) Margin debt – the amount of money that investors have borrowed in order to buy stocks – is now at the highest level in history, not only in absolute terms, but also relative to U.S. GDP.

2) The present ratio of U.S. total equity market capitalization to GDP is 2.63.
The historical norm (not the low, the norm!) is 0.78. - Which is about 70% below the current level.
Comment: The S&P 500;
Comment: FX Carry Trades - for when the time comes;


This is one of (if not THE) most lop sided FX positioning out there! (The whole world is currently LONG.)
This pair is still working it's way higher, anticipating one, final global equities rally, for a Blow-off Market Top.
So, now you know what to do ... (When the time comes, short this pair like there was no tomorrow!!)
Comment: The current Safe Havens and their "Risk On/Off" tendencies;

Comment: DJIA comparisons with other, worldwide indexes;
Comment: On a Foot Note;

You know you’re in a bubble

- When funding a 36-year stream of expected inflation-adjusted spending requires over 38 years of money up-front;

- When the median price/revenue ratio of S&P 500 components exceeds 3.3;

- When every single decile of S&P 500 components is at record valuation extremes; https://www.hussmanfunds.com/wp-content/...

- When the amount of leverage in the system (U.S. equity markets) is now easily the highest in history, by any measure, not just in absolute terms! (relative to GDP, etc. Margin Debt/GDP = Margin Debt/Market Cap x Market Cap/GDP Showing insane over-valuation across the board!)

- In a world where speculators now value the stock of bitcoin at one-fifth the value of the entire U.S. monetary base;

- Where the current SPAC mania is identical to the South Sea Bubble in as much as: "Let them see not what they do!";

- and so on...

Comments

Agreed boss
+1 Reply
@Verkaas, Cheers!
Reply
Nice analysis
+1 Reply
IanSinclaire Dave-FX-Hunter
@Dave-FX-Hunter, Thanks!
Reply
may be when governmental incentives and funding halt I guess
Reply
@Xi6, The Fed.'s Balance Sheet is no match for a 263% of GDP current US Market Capitalization!
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Comment removed.
IanSinclaire ramin_trader2006
@ramin_trader2006, I'm glad you think so. Without you, this business would be far more difficult! Cheers
Reply
DJI tankkk on the way. dont miss the chance to sell and make money
Reply
IanSinclaire wiseinvest05
@wiseinvest05, That's not just the DJIA. - All US equities! (Just for the record)
Reply
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