by winston » Mon Jan 30, 2017 9:44 am
Stock Market Investors Biggest Worries Today
Here are the three biggest worries I see for investors today:
1) The Economic Expansion and Bull Market are Long in the Tooth – as mentioned before, this is the 3rd longest U.S. economic expansion since 1900, and the 2nd longest bull market ever.
I’ve written many times before that bull markets do not necessarily have to die of old age, and neither do economic expansions. But, it can reasonably be deduced that there’s a reason expansions and bull markets don’t go on forever.
Assets eventually get mispriced and growth cycles get stunted by bubbles or misallocations of capital. It’s only a matter of time.
2) Geopolitical Instability – all bets appear to be off when it comes to President Trump’s vision of America’s place within the global political and economic sphere. This may embolden China and/or Russia to make drastic bets, which can have far-reaching economic and market consequences.
It’s difficult to know exactly what those may be, but it feels as though now more than ever the political chess match has intensified greatly.
3) Euphoria – with fiscal stimulus seemingly on the way as well as tax cuts and promised deregulation, investors and corporations may get a little too excited about growth prospects ahead.
When that happens, investors tend to take more risks, which bids up the prices of assets well into overvalued territory. Before everyone realizes that everything is overpriced, the bear market will likely be in full force.
Source: Zacks
It's all about "how much you made when you were right" & "how little you lost when you were wrong"