Roaring 20s, Roaring 20s Paralleled 100 Year Event.
Roaring 20s, Roaring 20s Paralleled 100 Year Event.
The big question is does it end in a giant crash without a depression? and the answer will ultimately be how well the leveraged is contained in the later stages of the market.
- During 1920s - 1930s we experienced a "pandemic event" in both scenarios *odd*.
- It created a shock crash followed by a pandemic rebound that the masses called "bubble" this is where valuations broke due to a black swan event.
- We use the SMA 2D (200) that shows the larger trend of the market and we see similarities of this "bubble" crash bounce in 1922-1924, oddly similar to 2022-2024 right?.
- What's even more dangerous about today is the market in the roaring 20s was held back by the Gold dollar peg, today? we don't even have that. We just have interest rates.
- Following the 1924 situation the New York FED cut funding rates to avoid a "unemployment crisis" and it began the fueling of the final stage of a major bubble.
- Differences? during the pandemic in the 2020s Governments forced central banks to print trillions and trillions and enforce lock downs to stop the circulation of the currency. Following this they then raised interest rates globally sucking capital back into "bills" "Money Market Funds".
- What happens next?, the FRED will cut interest rates aggressively to avoid unemployment spiking trying to front run the future and in return these rates being lowered will rally bonds and release capital and new leverage back onto the market based on the debasement of QE we experienced. Yes the QE during the pandemic barely touched the markets where people were calling 2022 a "bubble".
- SPX/USM2 has broken out of a major trend while the FRED aggressively raised interest rates indicating this new "trend" cannot be contained without raising rates higher and its impossible to do so with the Government debt interest.
- A new bubble fueled by
"Artificial Intelligence, Bitcoin, Electric Cars, Robotics, Biotechnology"
could be rivalling the
"automobile, radio, and electricity" fuel of the 1920s.
The big question is does it end in a giant crash without a depression? and the answer will ultimately be how well the leveraged is contained in the later stages of the market.
Note
The FRED has cut interest rates as expected.
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