For once i agree with you.Although Trump cant stop a crash,i don't think he will be responsable for one either.
Apparently the market auto corrects every 10 yrs can be 10% or i belive whats termed a bear adjustment 20% down or more
which can take years to recover from and we are apparently due.
bull market started march 2009 so its been 10 yrs upwards and normally its a max 4.5
No, the US market doesn't just magically correct every ten years, or so, there has to be an economic reason like the tech bubble in 2000 or the liquidity crisis of mortgage debt in 2008.
While the US economy is slowing under the Trump mess (Obama had faster GDP growth in his last 3 years compared to Trump) even at just below 2% projected for 2020, it is still one of the best in the world. Europe is at or closer to a recession, Japan a mess, massive risk from the no-deal Brexit in the UK, now with less than a year to do a deal with the EU, etc.
In the US, the consumer is strong, offsetting declines in the manufacturing sector. Trump won Pennsylvania, Michigan, Ohio, Wisconsin in 2016, promising working-class voters he would revive US manufacturing. But all four states have lost more than 16,000 factory jobs in the past year alone.
And many new production jobs are non-union with lower pay, according to Pew Research. That translates to the loss of good wages for Americans without a college degree, the majority of which voted Trump into office.
In 2019, production workers earned 20% below the national average, a UC Berkeley study found. A third of manufacturing employees rely on food stamps or other federal assistance programs to make ends meet.
During Trump's first 35 months in office, the US economy has gained 6.69 million jobs. But during a comparable 35-month period at the end of Obama's tenure, employers added 7.96 million jobs, or 19%, more than what has been added since Trump took office. The average monthly gain so far under Trump is 191,000 jobs. During the last 35 months under Obama, employers were adding an average of 227,000 jobs a month.
The GDP spiked to a high of 3.1% due to the short term effects of Trump's $trillion tax cut for the wealthy. He made up his fantasy of a 4-6% growth rate due to the cuts, which of course, no serious investor believed. We now have the most massive federal debt since WWII, with no end in sight.
Interest rates are kept low since even at 1.6% on the 10-year treasury; it is about the best return of major nations sovereign debt globally We have about $14 trillion of NEGATIVE interest rates globally on government debt! It is a bit hard to wrap your brain around negative interest rates.
The trade war is hurting, and the latest China deal for a goal of $250b of purchases never was believed to be realistic. Now with the virus in China, it even more unlikely. In the meantime, we have record high since the Depression farmer bankruptcies even after the massive payments by Trump about ten times greater than the auto bailout the Republicans complained so much about - and all not paid for except for more debt.
S&P500 earnings were almost flat last year and the P/E ratios are very high. It looks like maybe 5% earnings growth currently projected for 2020.
The US economy is crawling along and someday the deficit will have to be addressed but so far all is well. For investors, I recommend a "participate yet protect" investment portfolio using equity hedges. However, bonds may be riskier than equities since rates are at near all-time lows and bonds lose value once rates climb to more normalized long-term levels. So I do not recommend bonds as protection.
