The S&P 500 fell 151.23 points, or 3.9%, to 3749.63. The Dow Jones Industrial Average dropped 876.05 points, or 2.8%, to 30516.74. The tech-heavy Nasdaq Composite declined 530.80 points, or 4.7%, to 10809.23 (33% lower that the November record).
CNBC – […] U.S. stocks on Monday entered a bear market because the S&P 500 closed more than 21% below its all-time record close reached as recently as last January, S&P Global Dow Jones Indices senior index analyst Howard Silverblatt wrote.
Stocks had been flirting with a bear market for the past several weeks on an intraday basis, but had never actually closed below 3837, the level S&P Global needed to see in order to officially declare one.
S&P Global says a 20% decline in the S&P 500 on a closing basis from its previous peak is all it takes to define a bear market. Which means that this bear market is already more than five months old, since the S&P 500 all-time high came on January 3. (read more)
The old axiom was that the economy follows Wall Street by 6 months. If this holds true, we are in for a long period of pain. With the republicans poised to take control of the house and senate, the leftwing media will have a scapegoat to put the blame on and to gaslight their base and the uninformed prior to the 2024 election/selection.
Wash, rinse, repeat !! It’s been going on for 50 years !! Only this, much worse
Agree in that been there done that. 3-times as a matter of fact. After the first time in which I lost my ass, I never went back to the market. I went into other investments.
Perhaps we can aid in breaking this pernicious cycle by exterminating the complicit media. After all, without these vermin, much of the destructive transformation of America would not have been possible.
While I would normally agree with you I think we’ve already hit our Lehman moment, even though there isn’t a specific company to point to as a catalyst. As far as the proof in the pudding goes I think you need to look no further then assets people can drain of liquidity easy first. Crypto, and it’s seismic fall points to an incredibly weak financial position for Joe SixPack. About 5-6 weeks ago I was pointing out to people that crypto is where you’d see the avalanche begin. Unfortunately the avalanche has only begun as some people leveraged their crypto to further by more, but you have margin calls written in loan contracts forcing the underlying assets sale once it hits a certain floor creating a self reinforced doom loop. Further, despite a reduction in purchasing power, dollars are still high in demand (see reverse repo in fed where things like securities are sold back to the fed ‘ie: reverse repurchase option’ for cash on a short 1-2 day period to meet cash obligations.) Reverse Repo’s are tagging 1+ trillion several times a week. Which in the big scheme means there aren’t enough dollars (deposits) in circulation to meet demands (‘payments due’ in simple terms). So what we have is both a liquidity problem as well as purchasing power (inflation) problem. I could go on and on, but there is no historical basis for which to view the current predicament the fed reserve has painted themselves into. Thus this is likely to be worse then any of us have seen in any living persons memory.
“ So what we have is both a liquidity problem as well as purchasing power (inflation) problem.”
There is never enough money in circulation…until there is too much.
If you insist on saturating liquidity preference, you will have created the necessary conditions for a hyperinflationary spiral that will kill off the US dollar.
The only way to escape an economic collapse is for the Fed to allow savings and interest to equilibrate. They will have to stop forcing down interest rates by buying new debt.
Whether or not this is politically feasible depends on the willingness of the US electorate to suffer a steep economic downturn.
Inflation and liquidity are not mutually exclusive though. You can have a lack of liquidity at the same time as a reduction in purchasing power.
I do agree there is never enough until there is too much. This is why debt based monetary systems always fail. Always.
No debt is King.
90% of the time I agree. My only debt is a 2.5% APY on a home where the debt payment to income ratio is less then 10%. Our purchase price was approximately 100% of our annual income. In a world like today I’ll take the 15% real return (vs real inflation) paid by the bank to live here. We don’t have car loans, credit card balances, or any other revolving or non revolving debt. While my case is a narrow example, it is a narrow path of good use of leverage.
Same situation here, but energy and food costs are killers.
In this coming environment being ‘debt free’ is truly the only way to go. There will be a ton of forced deleveraging causing financial chaos. Having some cash on hand can be very comforting if nothing else.
I think the political problem is not limited to a recession. The problem we have today that we’ve never had before is the actual level of the national debt. Raising interest rates even a few points makes servicing that debt nearly untenable. When we last had this problem, the debt was far lower, and raising interest rates resulted in interest expense being a far lower percentage of the budget. Today, with 30T in debt, an increase of a few points will result in interest expense taking up an impossible percentage of the budget. The old tricks won’t work this time, and there is no Paul Volker waiting in the wings. Decades of irresponsible borrowing and spending has now finally, at long last, put us on the brink of bankruptcy.
Thanks, Okie for making the esoteric much less esoteric.
“So what we have is both a liquidity problem as well as a purchasing power (inflation) problem…there is no historical basis for which to view the current predicament the fed reserve has painted themselves into.”
Very well said, but, sadly, a recipe for doom!
If Trump were in power, you know he would ramp up production in order to increase the purchasing power of the dollar, and then let the chips ‘fall where they may’ to see where they settle before he made his second important move to save the economy.
Amen. I think the will among the restless population is there if the income is there. And since Trump started what would’ve been a revolutionary re-shoring of our manufacturing, we’d be leaps and bonds ahead of where we were in Jan 2021…and lightyears ahead of where we’ve fallen back to. We have intentionally rudderless leadership right now. Gotta destroy so they can 6uild 6ack 6etter…
Crypto is a joke, there is no intrinsic value in crypto. An asset without intrinsic value is not an asset.
I agree. My biggest issue with it is that I have seen multiple guys i would bleed for sink entire family fortunes into it. Yet today, literally this morning, they are all still clinging that this is just a small correction before the next big pop, or that they believe in the “idea” of a decentralized “currency”. All of them have breakeven around 40-45k (BTC). So they’d have to see a 120% price appreciation from today just to break even. I’ve warned them all from the moments they let me know they went in, and they all just went further in. One even sold their home, and “invested” the entirety of the remaining equity (about $175k that’s worth about $80k now). It drives me nuts. I get the fed reserve funny money is a ponzi scheme but at least it has our economic ability to produce something…anything as a backing.
What are the actual stats? If memory serves, I recall reading that the bulk of crypto ownership is concentrated in just a few individuals.
The Fed should have acted in December. Raising rates now will only add fuel to the fire. It will make the recession even deeper. The way out of this mess is have government cut spending massively, as most of government spending is waste. Then Drill baby Drill.
It’s the same old song and dance. McConnell/McCarthy will be in the situation they despise most – actually having to do something. But have no fear, there’s a script for this, and we’ve seen the movie before: On day one, they will propose tax cuts, O’Xiden will duly refuse, and there the stalemate will remain until 2024. The media will ignore the economy and focus on white supremacy, J6 and the many more school shootings you can be sure will be staged in the next 2.5 years.
So true! The shooter grooming always continues, just as the rings of arsonists will be ready to conduct their ethnic cleansing in order to rid the West of white supremacists living in rural territories, which, as the twisted thinking goes, actually belongs to indigenous people (so pure are they!).
This brings up a conundrum that keeps me up at night along with the destruction of the USA.
So, where, exactly, on this planet is a “native land” that belongs to indigenous Whites? If all of the POC invaders were driven out of Europe, could all of us without anything but Western European roots be permitted to return to our native “reservation”?
AFAIK, Whites are the ONLY people in the world without an acknowledged and revered “homeland.” We are forever told that we are colonizers and rapists who destroyed “natural and native purebred people’s land” and stole it from the “rightful owners.”
OK, so who stole my native, natural land and why can’t my lily-white azz return to Europe where my people are native and all non-Europeans in Europe go back to wherever they are native? My ancestors were stolen from the streets of Norwich, London, York, and Belfast clapped in irons and shipped to the colonies to serve until they died or were lucky enough to escape. Only one ancestor paid a passage and came of his own volition. He was my last “immigrant” ancestor who arrived in 1826 from London, though he was from Canterbury.
If this land is to return to Creek possession (or will they have to fight it out with the Seminoles and Miccosukee?) fine. Just let me go be with my own in my own land, too, where we speak our own language and follow our own Christian and Germanic customs. Common law, anyone? The “custom of the county,” anyone?
Beo gesund.
But it’s not like they’re NOT getting help from those dull-horned RINO$.
I like to say there are no RINOs beyond those who wish the party wasn’t what it is…
A synonym for denialism.
It was big tech, Wall Street and the big banks especially investment banks like Goldman Sachs that got Biden and the Democrats elected. Investment banks don’t make their big money and their partners don’t get $500,000 bonuses without cranking out IPOs and they don’t do IPOs in a bear market! This doom and gloom isn’t going to last very long. At some point the Democrats will open up the oil spigot and inflation goes away!
“Long period of pain.” Indeed. Economically, politically and socially. Right on up to Jan 2025 when PDJT is sworn in again as POTUS.
While I agree they will definitely try that I would have ad after ad running that points out what they have said.
The economy was in the tank in October. Wall Street was behind the curve.
Yep, I’ve been telling family members and friends who are Democrats that I’m voting Democrat this election cycle. They are delighted; I am not telling them the reason is so they can not escape the blame.
I figure since I tried to vote for Trump last time, might as well cast my ballot as it will turn out anyway. Time for some overpriced pb&j sandwiches.
Putin’s price hike. BS.
That war would stop if our state department allowed it to.
So far it’s been great for Putin and the Ruble.
https://www.xe.com/currencycharts/?from=RUB&to=USD&view=5Y
In fact, both the Ruble and the Yuan are doing ok.
https://finance.yahoo.com/news/yuan-ruble-trading-surges-america-214045054.html
And, as they and others divest of the Dollar, expect even more inflation. But we have to keep in mind, this isn’t just an Ameristan problem, it’s all Western governments. As an example.
https://www.zerohedge.com/markets/japan-verge-systemic-collapse-dramatic-unpredictable-non-linearities-financial-markets-bank
“So far it’s been great for Putin and the Ruble.”
I’m still waiting for someone to tell me how a stronger currency leads to increased exports for an export-dependent economy like Russia’s.
False premise. Russia doesn’t have a strong economy anyway but it has Europe dependent on its gas, oil and agricultural materials. Don’t worry the state department is willing to fight to the last Ukrainian for you.
Apparently Indian refineries are buying Russian crude then selling their refined/distilled products into the European market.
The Russian finance minister dropped the interest rate to 9.5% on Friday in an effort to weaken the ruble and help the domestic economy. Instead, the ruble strengthened.
BRICS alliance (Brazil, Russia, India, China and South Africa)
If you are selling oil, gas, wheat, fertilizer, and other critical items the world cannot do without, and you have a strong currency… you are not struggling.
To put it mildly.
Get someone to read this to you slowly, if you are experiencing difficulties comprehending it.
Imports and exports are baked into currency value, along with many other factors (trade deficit, unemployment, banking capital, growth rates, geopolitical conditions, etc).
And remember, when you sell more goods and services to other markets (nations) than you buy (ie., have a trade surplus) your currency strengthens.
The answer you are looking for is right in front of you before you even asked the question.
This war was started by the state department in 2013,
It’s that Russian Bear market.
One of Joes least discussed accomplishments is the extraordinary success he had in cementing much stronger ties between two historical adversaries. Russia and China.
Never let it be said that the marionette isn’t a unifier.
Has Joe ever done a single good thing that benefitted most Americans after sitting for more than half a century in elected office?
A single f@(#!#g thing?
No, he is a worthless, creepy man.
Would someone, anyone, please put the Xiden peeps on record asking, what historic gains exactly?
https://valiantnews.com/2022/06/press-sec-americans-well-positioned-for-failing-economy/
Easy: Inflation, gas prices, and the number of illegal aliens in the country. All three have gained historic highs.
Of course…
Behind the Eight Ball…
“Watch money. Money is the barometer of a society’s virtue. When you see that trading is done, not by consent, but by compulsion–when you see that in order to produce, you need to obtain permission from men who produce nothing–when you see that money is flowing to those who deal, not in goods, but in favors–when you see that men get richer by graft and by pull than by work, and your laws don’t protect you against them, but protect them against you–when you see corruption being rewarded and honesty becoming a self-sacrifice–you may know that your society is doomed.” – Francisco D’Antonia
Atlas Shrugged
I cut the cord in 2005!! God is in control. No worries. Everyday is a ⛱️ beach day!
Gracias Dios🙏🙏
Ah, you speak the nanny, gardener, and pool guy tongue. How nice.
I’m not much concerned with a bear market. They come and go so I just stay the course. My concern these days is more of something like a package of bologna costing a day’s pay. Something like that would render investment portfolios irrelevant. That seems over the top but it does feel like we are on the precipice of something.
Keep your eyes sharp, and your jaws open!
Which is why I’m making decent money on puts.
“…we are on the precipice of something.”
Not really, the 30’s and 40’s were much much worse people have just forgotten. Few alive in this country today have ever experienced hunger and I doubt most will.
The biggest health problem today is obesity. We haven’t hit starving, yet, (but when we do….)
It is already being reported repeatedly by Greg Kelly and others on Snoozemax that families are deciding the parents will skip a meal so the kids can have three squares. They’ve been reporting this for weeks on Snoozemax.
It’s started.
No one has to skip meals (at least not yet), you just have to be aware of what you are buying and cook at home. We are eating more chicken legs (10 pounds for $6 at Aldi), and less beef. More oatmeal and less frozen waffles. More rice and less salad (until the garden starts producing).
Less junk, more real food.
This is only the beginning. Basically, every prediction Trump made regarding a Biden presidency was spot on.
My husband just inherited about 1 mil in stocks from his brother. Liquiedate?
Two Words….buy gold.
or oil
Yes
No. Have a pro rebalance it with more downside protection and ride it out.
Next level of resistance (when money managers will begin to buy) is probably 40% lower than it is today. This could get ugly.
Depends on the stocks.
Hello Jackie: Congratulations on your wind fall. Your question is actually more complex that it appears. I am no financial adviser but have been a small investor for about 40 years.
I’m sure you’re getting advice from many sources. My advice would be to do nothing. Are you familiar with these markets? If yes, then try to educate yourself and self direct your own investments. If you’re not familiar with these markets then try to work with someone who won’t churn your account for fees. Beware of people trying to take advantage. I am self directed, but if I weren’t I would ONLY use a fee based advisor. No percentages taken from your investments for advice! Your husband’s brother may have been doing a good job the way it already is invested??
I would say to you that if you need this money right away I would then ‘probably’ liquidate right now. I just feel that the next six months are going to be brutal to the downside. I could be wrong, but your risk in that case is to any gain you would have made to the upside. Current conditions strongly disfavor that scenario.
We very probably are already in the clutches of a recession. At this point it looks like it could be serious for a period of time?? You will hear the word ‘volatility’. Generally this refers to the market swings which seem to always favor the down side. We are in for some severe swings which we have already experienced and seen.
Gold? I own a ‘small’ amount of Gold just for hedging purposes. During the 2008 crash Gold got slaughtered along with everything else. It was suppose to zoom to the upside during market chaos. That didn’t happen…. Never by gold on line!! I happen to have a small gold shop in my community that is excellent. I buy Gold Coins for that day’s spot price plus a little added on for his profit. Coins from the US, Canada, and a few Pandas from China. Use caution and a reputable dealer.
All the best to you. Protect your inheritance as the charlatans are everywhere.
Consumer sentiment has not been this bleak since the real estate crash of 2008.
http://www.sca.isr.umich.edu/
Will history repeat? Don’t forget, Joe Biden is the crash test dummy of 2022.
CW, you just nailed the zeitgeist… Crash test dummy, that’s perfect! And so sad for us as a nation…
I’ve herd it said, that many indicators are worse now than they were in 2008.
So far we’ve wiped all gains form 2022, 2021 and half of 2020.
The 2008 crash was never actually resolved. The FED used QE (money printing) to buy the bad debt the banks held. The banks were once again solvent. The FED put that debt on their books, but the actual situation was never resolved. The can was just kicked down the road.
It’s now raising it’s ugly head once again. This time printing trillions of dollars won’t solve this issue. MMT (Modern Monetary Theory) states that countries that print thier own fiat currency can print whatever they need without consequences. I believe this is what drives some FED policy.
The world wide sovereign debt load is unmanageable. The western nations have 100s of trillions in loans and social obligations to service. The EU is in even worse shape that the US here. Just let one nation crack and default and the contagion will begin. Our vaunted leaders are well aware of this and may try to install a digital currency. THIS IS THE KISS OF DEATH FOR HUMAN FREEDOMS.
Anyone with half a brain who saw what Justin Trudeau did to the Canadian truckers should understand. With the stroke of a keyboard they froze ALL the financial accounts of the dissidents they disagreed with. It was very effective. Unfortunately for Justin it caused a run on the banks and his NEW World Order buddies told him to knock it off. He was prematurely tipping off their future strategy. No, No, No.
The most important words here is that the bear market is already 5 months old, and we are not even close to the bottom.
The market was overvalued. For some time.
Build back better, new green deal and all that jazz will make this year more like 1929. Five months into it, this may take years to come out of.
Look at some popular NASDAQ stocks at the end of 2020. Where are they now? They’ve been slaughtered. Facebook down 384 to 160. NFLX 700 to 170. AMZN 188 to 103. AAPL 182 to 131. ZM 500 to 100. TSLA 1240 to 64y. SHOP 1763 to 313. NVDA 346 to 156. SAM 1200 to 300. NVAX 300 to 36. GOOG 3000 to 2100. SE 372 to 70.
Just a few examples. Big stocks which made big percentages in multiple ETFs and mutual funds have been rocked.
Just like the 70’s and into 1980-82 when Reagan came to the rescue, this inflationary spiral will end with very high interest rates put in place by the Fed that creates a deep and very painful recession with high unemployment. That wrings out inflation and resets the business cycle for a multi-year expansion.
Don’t count on it. We didn’t have 30T in debt, and the associated interest payments, in the early 1980s. Double digit interest rates today will exacerbate the problem, not solve it. Consider:
In fiscal year 2021, the gov’t collected a little more than 4 trillion in tax revenue. The debt is about 30 trillion. At a 0.50% interest rate (using round numbers to illustrate), interest for fiscal 2021 came to about 15o billion, or about 4% of revenue collected. Let’s say interest rates go to 5%. Then you get interest at 1.5 TRILLION, or 38% of revenue collected. Now let’s say, like in the early 80s, interest goes to 20%. Now you’d get interest at 6 trillion a year, 2 trillion more than revenue collected, forcing the gov’t to BORROW MORE just to service the debt. That’s the road to bankruptcy, and it’s why the solutions that worked in the 80s won’t work now.
You mean all those “workers” who didn’t show up to work because they had
Covid multiple times along with they were exposed to Covid multiple times
will now legitimately not have jobs?
If they were vaccinated it will very likely become a moot point.
First Russian Bears, now Wall Street Bears, meanwhile, this Administration* is unbearable.
All of this is on purpose and the RINOS are 100% complicit.
The most corrupt and anti American people this country has ever seen.
Virtually all of the people in Congress and DC need to be voted out of politics forever!
That would imply you’re going to vote more replacements in… There’s the problem.
I’m still saying all aboard and let’s get this train off that cliff…
It sounds sadistic but in reality it’s going to take a seriously bad break to push people into change.
Maybe WE should be the ones never letting a good crisis go to waste?
Dev, I used to do hard things for my .gov paycheck. We do NOT want to wish those times here. Ever.
It is inevitable.
Nobody sane is wishing for it.
It may simply be a better path.
Many here are, and have been on a Government payroll, and know how the sausage is made.
It’s unfortunate but it’s part of the gig when it comes to managing governments.
We let this one go to far over the last century and a half. Eventually you have to pay the Piper.
The change that will happen is Cloward-Piven.
WTF is wrong with Trump. Digging his own grave
If Mo Brooks testifies at Jan 6… Jesus
Driving the news: “President Trump asked me to rescind the 2020 elections, immediately remove Joe Biden from the White House, immediately put President Trump back in the White House, and hold a new special election for the presidency,” Brooks said in a statement.
Serious question – does Mo Brooks have the power to do that? I suspect not so it
doesn’t make sense that the question was even asked. No wonder President Trump
is backing the other guy.
Heaven forbid if all this economic buzzkill detracts from celebrating Juneteenth! s/
There were still slaves in the USA after Juneteenth.
Did Mary Todd Lincoln ever give her slaves up? I know they had to drag her from the White House kicking and screaming.
Interesting quote from beginning of the pandemic when the fed first started printing money. Now to the tune of 13 trillion dollars.
“Hope you didn’t put much money on that bet, Dawg. These ****ers are going to print hard enough to wake the dead. They’ll print like mo’fos, print like mad men, print like fly pimps. Print until their eyes bleed. They will print via the swaps, via bank bailouts and mergers, via fixed Treasury yields, via real honest-to-God negative interest rates, via loans to banks on no collateral, via payroll tax reductions, and in the end via actual fiat paper instruments which they might very well drop in bails from actual muther****ing helicopters. They will not give two figs what anyone thinks. Here is why. Because this is the Goddamned end of it my friend. There is no accounting beyond this point. There will be no history of it. No one to take notes of rates of exchange, or of the graft and violence, nobody to worry about the deficit or the GDP or the national debt of any nation large or small under the blazing Goddamned sun. End. Of. It. Does anyone bitch about how Rome totally debased their coinage at the end? Hell no. But whoever did it had enough to hand and grabbed some land with a nice vineyard and sat back and waited for the Middle Ages to start 700 years further on. And that’s what a singularity is about. Anything that passes through is striped of all meaning. Nothing we think is important now will remain so beyond the event horizon. Nobody will remember, nobody will write about it, nobody will be held to any standard. Ever for evar. So yeah, they’ll print like the mad crazed terrorists they are. Because they have nothing to lose, and maybe something to gain. Maybe a dollar. Maybe a day. Maybe a slim chance to escape with some of the loot. Whatever the **** advantage they see in it, for themselves and their elite crap wanking buddies, they will full-on-full-time-******* do it to advantage. Watch for it, Dawg. It’s totally on this time, on like Donkey Kong. And when the dust is settled in a generation hence it’s going to have become another unbelievable episode among the ages of men.”
I don’t think the general public out there will pay much attention to the Stock Market until the market drops below 30,000. The mask wearers will never pay attention.
I love bear markets (when I have a short position)
PS: for those worried about the image – it is of a human who raised the bear from a cub, play wrestling with the friendly adult bear.
Man, I’d never trust one of those things anywhere near me, raised from a cute little fuzzy cub or not.
I listen to Scary Bear Attacks on YT too much, I guess, and I had a grizz encounter at Glacier in the 1980s that ended with the bear just browsing the berries and giving me a “Get lost, Hooman.” growl.
Somewhere 0bama is laughing.
That is the stooooopidest black-lesbian-immigrant I have ever seen at the podium in the briefing room.
I think she and the rest of them will go down with the ship. How the administration thinks they are going to avoid being hit by bricks, limbs, mortar, hail fire and other debris as the country they’ve destroyed starts crumbling is beyond me. What they are doing is the very definition of INSANITY.
Big Guy hasn’t thought this thing through very well as he and his will suffer too. Of course, he’s not capable of thinking at all.
Welllll…the next hammer is about to drop. The housing bubble is beginning to pop in many metropolitan areas as mortgage rates now average 6.1%. Heavily leveraged flippers and owners who held on for further price increases are starting to panic sell.
Yellen said we are not going into a recession. Translation hold on to your boots!