The Fed plans to trim its balance sheets and has warned investors that rate hikes are coming later this year. As interest rates rise, general stock and bond prices fall. P/E ratios for the various US stock indexes are relatively high by historical performance, earnings in some critical sectors have been disappointing. And, over the past week, stocks have dropped sharply. Early morning rallies have ended in sharp share selloffs at the closing bell.
A significant correction is coming. The correctiom may be worse than the crisis in 2008. First, we must see droves of people unable to pay their monthly mortgages. But I can feel it coming. What is your call?
I hope we can escape real trouble, but think a 20% correction could be in the cards. The other wild cards in the deck are the Ukraine situation, further sustained inflationary pressure yet a new covid variant, rising energy costs, political gridlock. It's been a tough two years for everyone around the globe and just hope 2022 ends better than it has started. Thanks for recommending the discussion,.
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