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Wealth Building Strategies

2017 Market Lessons

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Posted by NorthmanTrader

on Wednesday, 03 January 2018 06:27

Before I publish my market outlook for 2018 in the days ahead I thought it might be useful to recap some lessons learned from 2017. While I want to focus on technical considerations some larger market context first is equally important.

The biggest mistake bears always make, myself included, is underestimate the sheer recklessness of bulls. They keep raising the bar higher and higher, get everyone positioned long and when the construct ultimately fails they beg for bailouts and artificial liquidity comes in to save an industry that is 100% reliant on convincing retail to put money into the system. This may seem a harsh assessment, but this has been the script for the last 30 years as we’ve transitioned from one market bubble to the next.

Bubbles are notorious for getting people sucked into believing things that are absolutely unrealistic. Multiples get expanded to high heaven on projections that never pan out. Every. single. time.

In this context it’s actually quite easy to be a bull. Keep raising targets, always be optimistic, and when something breaks shrug your shoulders and say: Hey what are you gonna do? Stuff happens, but the Fed will bail us out. And the cycle begins anew.

It’s a dangerous game for investors as Wall Street will look right for years and complacency breeds more complacency as bearish voices are ignored as they look wrong precisely at the time when they are the most right.

Take 1999. Bears were completely wrong, but also entirely correct. The bubble run-up was pure fantasy, but it kept going and going until the rug got pulled:

NDX

 

Similarly in 2007 nobody gave you warnings, and Wall Street kept pushing price targets higher for 2008:


And people got hurt big time every time.

The then predictable response: We need bailouts, must get rid of mark to market and the Fed obliged with QE 1, 2, 3 and global central banks joined the foray. And this has been the running game for over 8 years now:

.....continue reading more charts and analysis HERE



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Wealth Building Strategies

Technically Speaking: Revisiting Bob Farrell’s 10-Rules

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Posted by Lance Roberts - Real Investment Advice

on Tuesday, 02 January 2018 06:41

As I noted this past weekend, 2017 was a year for the record books. Not surprisingly, the strong advance fostered a surge in investor optimism which pushed allocations to equities to the second highest level on record.

sdf

And leveraged to boot.



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Wealth Building Strategies

Gold And Silver Futures Swing From Bearish To Bullish In Just Two Weeks

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Posted by John Rubino - Dollarcollapse.com

on Tuesday, 19 December 2017 06:37

After holding onto huge, unprofitable long positions for months, gold and silver futures speculators are finally giving up and bailing out, while commercial traders (who take the opposite side of these trades, since every long requires an offsetting short) are closing out their shorts at a near-record pace. 

Here’s the gold data for last week, courtesy ofGoldSeek. Note the massive shift by speculators from long to short. They’re not in balance yet (where longs and shorts are equal) but they’re heading that way fast. 

Gold-COT-Dec-17-17

In silver, they’re just about in balance, which is historically about as far they usually go:


Here’s the same data for gold in graphical form with the silver bars representing speculator longs and the red showing commercial shorts. Note the long plateau followed by a rush to the middle, which is where rallies tend to begin. 



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Wealth Building Strategies

The Remarkable Early Years of Warren Buffett

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Posted by VisualCapitalist.com

on Friday, 15 December 2017 06:54

For most people, the “Oracle of Omaha” needs no introduction. With a self-made net worth of $84 billion, some experts consider the 87-year-old to be the greatest investor of all-time. 

Despite his incredible achievements and decades in the public eye, the modest Midwesterner is frugal, relatable, and full of humility – and his life story is an endless source of lessons to aspiring business professionals around the world.

Screen Shot 2017-12-15 at 7.01.31 AM

Today’s infographic, which is done in partnership with finder.com, is Part 1 of the Warren Buffett Series, a five-part biographical series about the legendary investor. 

The Warren Buffet Series: The Early YearsComing soonComing soonComing soonComing soon



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Wealth Building Strategies

Eric Sprott - The Gold Market

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Posted by Eric Sprott via BullionStar Perspectives

on Wednesday, 13 December 2017 06:14

In this interview, Mr. Sprott shares his thoughts on the gold market, distinguishing between the paper market and the physical market and the current market dynamics. Eric concludes the interview by sharing advice for both new and experienced gold investors alike.

This interview was conducted in November 2017 during BullionStar's participation at the Precious Metals Investment Symposium in Melbourne, Australia.

For more precious metals related interviews with known gold proponents such as e.g. Jim Rogers, David Morgan and Chris Powell, go to BullionStar Perspectives.

Screen Shot 2017-12-13 at 7.21.01 AM



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