AI-powered
podcast player
Listen to all your favourite podcasts with AI-powered features
The market has been range-bound with uncertainty and indecision, struggling to find a clear direction. It has experienced a correction of around 5% but has attempted to recover. However, the market is currently facing challenges in deciding its future path.
September is historically known for lackluster market performance and sideways drifting. With low liquidity and volume, markets tend to be sluggish in September, although it is not exceptionally weak. This period sets the stage for the traditionally stronger months of October to December, fueled by increased economic activity, holiday shopping, and portfolio manager allocations.
Technical analysis and market psychology have been driving market trends more than fundamental factors like earnings growth. The markets have shown resilience and a tendency to focus on short-term technical indicators. However, over the long term, earnings growth is crucial for sustainable market performance, and valuations appear overextended, potentially leading to low returns over the next 10 to 20 years.
The elevated level of debt and higher interest rates pose challenges to the market and the overall economy. Historically, when interest rates are high, companies, households, and the government face increased financial risks. Financial conditions have worsened, indicating potential strain for financing and tighter economic growth. However, the Federal Reserve's involvement in bailing out systemically important companies has created the perception of limited risk, thus maintaining low credit spreads. The repercussions of excessive debt and stagnant financial conditions may be a concern for future economic performance.
In investing, taking risks is essential, but it's important not to take too many risks at once. Managing risk is crucial to achieving better long-term returns. Traditional buy-and-hold strategies can work, but they heavily depend on the starting point of the investment. Starting in a recession can generate lower returns over time. Active management that focuses on avoiding large downturns in the market can lead to better overall performance.
GDI measures the income generated in the economy, and it closely relates to production. In order to consume, individuals need to produce first. The divergence between GDP and GDI is important to note, as it can suggest an economic slowdown. Historically, when this gap has widened, it has led to a recession. Considering GDP versus GDI can provide insights into the health of the economy and potential future performance.
Active risk management, including avoiding the 10 worst days in the market, can lead to better long-term returns compared to passively holding investments. Missing the 10 worst days can significantly improve overall returns, as these days often occur during bear markets. Being conservative and prioritizing risk management can help protect capital and lead to better overall investment outcomes.
Stocks and bonds are range-bound right now. Is the recovery from the swoon in August fizzling out? Or are assets just consolidating & preparing to power higher for the remainder of the year? (as recent technical analysis expert Sven Henrich predicts) Portfolio manager Lance Roberts & Wealthion's host Adam Taggart discuss those developments in this week's Market Recap, along with:
1. Lance's reaction to Sven Henrich's bullish outlook 2. The growing strain between bullish technicals and bearish fundamentals 3. The growing divergence between GDP and GDI and why it suggests a recession is very likely 4. Why a lost decade of no net growth may lie ahead for stocks 5. Why missing the 10 worst days of the market matters much more than catching the 10 best days 6. Lance's trades for the week
************************
At Wealthion, we show you how to protect and build your wealth by learning from the world’s top experts on finance and money. Each week we add new videos that provide you with access to the foremost specialists in investing, economics, the stock market, real estate and personal finance.
We offer exceptional interviews and explainer videos that dive deep into the trends driving today's markets, the economy, and your own net worth. We give you strategies for financial security, practical answers to questions like “how to grow my investments?”, and effective solutions for wealth building tailored to 'regular' investors just like you.
Let us help you prepare your portfolio just in case the future brings one or more of the following: inflation, deflation, a bull market, a bear market, a market correction, a stock market crash, a real estate bubble, a real estate crash, an economic boom, a recession, a depression, or another global financial crisis.
Put the wisdom from the money & markets experts we feature on Wealthion into action by scheduling a free consultation with Wealthion’s endorsed financial advisors, who will work with you to determine the right next steps for you to take in building your wealth.
SCHEDULE YOUR FREE WEALTH CONSULTATION with Wealthion's endorsed financial advisors here: https://www.wealthion.com/
Subscribe to our YouTube channel: https://www.youtube.com/channel/UCKMeK-HGHfUFFArZ91rzv5A?sub_confirmation=1
Follow Adam on Twitter: https://twitter.com/menlobear
Follow us on Facebook: https://www.facebook.com/Wealthion-109680281218040
#stocks2023 #bondyields #investing
******************************
IMPORTANT NOTE: The information, opinions, and insights expressed by our guests do not necessarily reflect the views of Wealthion. They are intended to provide a diverse perspective on the economy, investing, and other relevant topics to enrich your understanding of these complex fields.
While we value and appreciate the insights shared by our esteemed guests, they are to be viewed as personal opinions and not as official investment advice or recommendations from Wealthion. These opinions should not replace your own due diligence or the advice of a professional financial advisor.
We strongly encourage all of our audience members to seek out the guidance of a financial advisor who can provide advice based on your individual circumstances and financial goals. Wealthion has a distinguished network of advisors who are available to guide you on your financial journey. However, should you choose to seek guidance elsewhere, we respect and support your decision to do so.
The world of finance and investment is intricate and diverse. It's our mission at Wealthion to provide you with a variety of insights and perspectives to help you navigate it more effectively. We thank you for your understanding and your trust.
Learn more about your ad choices. Visit megaphone.fm/adchoices
Listen to all your favourite podcasts with AI-powered features
Listen to the best highlights from the podcasts you love and dive into the full episode
Hear something you like? Tap your headphones to save it with AI-generated key takeaways
Send highlights to Twitter, WhatsApp or export them to Notion, Readwise & more
Listen to all your favourite podcasts with AI-powered features
Listen to the best highlights from the podcasts you love and dive into the full episode