The markets always win

I am intrigued by this chart (click on the chart to enlarge it). The market cannot be on a sound footing without a strong bank index.

This index has been declining since August and is in the process of going below an important trendline. Is this a bad omen for the market? Time will tell, of course.

Something else is bothering me. The Fed is keeping interest rates low to help the banking system. But they are too low, and this action weakens the dollar, sending oil prices higher. High oil prices will lower our purchasing power, and it will weaken the economy. Profits cannot grow much under this scenario. What will the Fed do then?

My point. The markets always win.

To find out more about my in depth view of the markets and my strategy just visit our website https://www.peterdag.com/ where you can review The Peter Dag Portfolio. You can also call me at 1-800-833-2782 to discuss your specific money management needs.

I will be happy to speak to your investment group on how the business cycle impacts investment strategies and the choice of asset classes.

George Dagnino, PhD
Editor, since 1977
Ranked in the Top 10 for 12, 6, and 3 months for market timing by Timer Digest

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