The more things change the more they stay the same. Ever hear that one before? I'm sure we all have, there are many constants in life, things that stay the same.
The same holds true for this stock market. Despite all the change.. the one constant has been a stock market that continues to rally to new record highs.
And yet despite this constant... despite a market that has moved to record high after record high... there remains so many rooting for its demise.
As we've pulled back this month, I'm seeing more and more calls for that market crash scenario.
Yesterday I remarked in the chat room, that I should have done a better job saving all the market crash calls and downside predictions over the years.
That is surely one thing that hasn't changed. Despite a stock market that defied all those bearish calls for 10+ years... and endured the most dire economic disaster earlier this year to rally to yet another record highs, those market bears are still out there calling for lower prices. And most of them don't bring up a slow steady drip lower.
It is the maximum fear type predictions. Fear sells...
A chart like this... with a giant red arrow.
or maybe something like this....
guess what you NEVER see....
A chart like this
why? its boring.. and I guarantee you a giant red arrow gets 100x more likes and retweets than a market that is slowly grinding higher.
Why are stocks going to fall?
The FED is going to lose control....
Are we still buying this story?
The FED was 'out of ammo' in 2014.....
and yet when the Pandemic hit... the FED went on the offensive like never before.
The FED is never out of ammo as long as the world has faith in the U.S. Dollar.
The FED is never out of ammo as long as inflation remains under control.
The one constant through the steady march to record highs in the 2010's and the 2020 rapid recovery to yet new all time record highs has been low, and stubbornly so, inflation.
That's the worry. That is what will derail the stock market. Even then its going to go parabolic first.
Interest rates have been in a downtrend for 40 + years. That trend shows no sign of changing any time soon.
Those big RED down arrow charts that get 100's of likes on Twitter... they've always been there, usually by the same people. And guess what? They've been wrong every single time.
The same for this stock market has been the uptrend. Stocks are moving higher. Interest rates lower. Inflation low.
The change has been all the excuses to sell. The change has been moving the red arrow to the right as the market has rallied.
Be prepared for more of the same. More record highs. It's coming. And this most recent pull back from record highs will be like every other pull back from record highs since the dawn of man. Another precursor to fresh record highs. And another opportunity to move that giant down red arrow to the right on all those bears charts.