Forecast (Don't Read This !!)
past market corrections are screaming lessons we could benefit
from! Looking at past market corrections with 20/20 vision
provides a wealth of information. If you invested in the market
immediately after every crash or correction you would
have made money. After each major market decline over the
past 70 years it has taken a shorter and shorter period of
time for the market to recoup its losses and go higher. The
last two market corrections (fall 1998 and fall 1999), have
taken less than 90 days for the market to recoup their losses
and go higher.
During the first quarter of this year
stocks were going up 50 to 100 points in a day, 300 points
in a week. IPO's were going up 200 to 300 percent in their
first week of trading. People were making money hand over
fist!!!!! What did the people who missed the January/February
rally say to themselves? "I'm going to jump in when the
market goes down and stocks are more reasonably priced. I'm
not going to miss the next rally!!"
Well, guess what? Here's your opportunity.
Investors were buying stocks when the market was at 5,000.
They were buying when the market was at 4,000. If they were
buying stocks when the market was at 4,000 and 5,000, why
wouldn't they be buying stocks now when the market is at 3,000?
Who's going to make more money, the guy that bought stocks
at 5,000 or the guy who's buying now at 3,000? EXACTLY!!!!
After this market rebounds, you may have to wait 3 or 5
years for the market to correct itself significantly enough
to buy stock around these levels again. There are investors
out there who wish they could have bought after the 1987 crash,
the 1994 crash, the 1998 and 1999 corrections. Six months
from now, investors are going to wish they bought after the
April/May crash of 2000.
We've had five ¼ point interest
rate hikes over the past 9 months. We just had a ½
point rate hike and we feel that the FED will finish this
series of interest rate hikes in June with another ½
rate hike. After that we expect a summer rally because the
FED won't meet again until October. Right now we're at the
tail end of a correction. All investors: institutional
investors and individual investors alike are all waiting for
the catalyst that's going to turn this market around.
One possible catalyst is Prince Alwaweed. He's the 5th wealthiest
man in the world. Last week Prince Alwaweed put a BILLION
dollars into the stock market. It shows leadership. All
you need is one catalyst for the market to turn. Then other
Billionaires and other Institutions start jumping in. The
guys who are going to make the most money are the guys who
are buying stocks at 3,000 not 5,000. Another possible
catalyst to turn the market is the fact that there is currently
$2 Trillion dollars sitting on the sidelines waiting to re-enter
the market. When it does re-enter the market I'd rather
be invested one week too soon than a week too late.