Stock Market Opinion

It is my opinion that the market reached it’s high water mark of the current expansion Jan 26. There are new wages reports showing big increases in wages which is going to show the Fed that inflation is really starting to rise. The Fed will react by starting to increase interest rates and start to pull back on the trillions in quantitative easing it did. This will cause the stock markets to start going down. This will cause investors to lose faith in the market, which will cause rapid drops in stock prices down to more sustainable levels of 1.5 price to sales… http://www.multpl.com/s-p-500-price-to-sales.I have often been wrong when predicting stock price movements, but I do think that a price to sales ratio of 2.3 where it is currently is unsustainable. Rising interest rates will also cause real estate prices to drop. The alternative if the Fed does not raise interest rates is inflation, which is a danger to watch out for as well.

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Joel Gross

Joel Gross is the CEO of Coalition Technologies.