Posted on Jan 21, 2018
Bank of America has found the formula for a market meltdown
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My macroeconomics has grown a bit fuzzy over the year but it seems like today everyone has three, four or five signs of a market correction and none of them are similar. I looked at all four of these points. I did not see three as the magic number, but what did catch my eye the most was the 10 year Treasury Notes. .
Looking at a five year history it shows that when it came close to that 3% mark there was a drop in the rate. On 12/23/13 the rate was 3.02% by 1/26/15 it had fallen to 1.68%. After that there were movements up and down until the 1/15/18 rate of 2.63%.
Politics aside, Maybe I'm being near-sighted (or need a refresher course in Macro) looking at just this one indicator but looking at its trends make me wonder when the market correction will occur, or rather how soon.
Looking at a five year history it shows that when it came close to that 3% mark there was a drop in the rate. On 12/23/13 the rate was 3.02% by 1/26/15 it had fallen to 1.68%. After that there were movements up and down until the 1/15/18 rate of 2.63%.
Politics aside, Maybe I'm being near-sighted (or need a refresher course in Macro) looking at just this one indicator but looking at its trends make me wonder when the market correction will occur, or rather how soon.
Bank of America has found the formula for a market meltdown
Posted from aol.com
Economy
Economics
Stock Market
Posted 7 y ago
Responses: 2
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Interesting point, I think 3, 4 or even 5 signs is shorting the complexity of an economy. Many historical indicators say the market is a bit over priced - though I would say the market has built in already the economic growth we are seeing, and expect to see coming. So I would see the market in 2018 to be somewhat flat as it waits for the economy to 'catch up'. My unscientific opinion. :)
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I guess the thing to do is see what these benchmarks were during the last several market corrections and see if they correlate to what BAML is saying. As SFT Kevin Beran mentioned, the economy is in redial you complex so they may be other factors at play that will prevent a market meltdown or there are other indicators that have already been missed that indicate a meltdown is imminent or we are somewhere in between. Regardless of what the “experts” say we are due for a correction because they happen almost always within 10 years of the last correction. Something we are fast approaching.
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