The last hurrah??? There are views out there that the stock market will crash in April.
One factor is that we will start to see high inflation numbers in US for March 2021 onwards due to low base last year. How the bond market will react to the inflation number?
Will it accept the view by Fed Chairman that it is 'transitory' which he has been trying to IMPRINT and PREPARE the market for a while.
By end March, retail investors would have used up and Margin up their $1400 stimulus check. Jeremy Grantham expects the market to drop by May while Felix Zulauf expects a October 1987 in the summer.
The US treasury department's cash balance is below $1t and will be back to historical norm (which is $200-300b) by June/July due to drawdown. This meant that the debt issuance by US will increase as it no longer able to partially fund its deficit from the treasury department.
Bond yield might have to go up further if there is a bigger issuance in order to attract buyers??? Would China continue to buy US debts or maybe sell its bonds and buy other products like gold with its worsening relationship with US???
In a normal situation, if you have a 'bad' relationship with someone, would you invest more money in him or diversify out??? So who would buy the bonds when US increase its issuance in the 2nd half????
Feds to the rescue??? We already saw a market tantrum in Feb when there was a weak 7 year bond auction. With higher issuance and possibly less foreign buying, the bid-to-cover ratio would come under pressure
This year according to I-ching is 山火贲 which is a reckoning year which I guess excesses would be corrected. This year one should endeavour to do more good deeds and chinese lunar 8th month would be a month to watch.
Technical Analysis of Stock Market | Last Hurrahhttps://www.youtube.com/watch?v=k7pXQi8x1fI
