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A 32-year market vet warns the S&P 500 is set to fall 50% - 70% in the years ahead
Posted on 3/31/24 at 11:55 pm
Posted on 3/31/24 at 11:55 pm
quote:
Jon Wolfenbarger warns against long-term investment in the stock market due to high valuations.
Wolfenbarger believes a weakening labor market and impending recession could trigger a sell-off.
While some indicators suggest an economic slowdown, consensus views remain optimistic.
quote:
A sufficient catalyst, Woflenbarger said, is weakening in the labor market and a subsequent recession, which he believes is about to unfold.
Wolfenbarger shared with Business Insider multiple indicators he's watching that show the unemployment rate could rise in the months ahead.
The first is the National Federation of Independent Business' hiring plans index. Its three-month moving average has surged, indicating the unemployment rate could soon follow.
Second, The Conference Board's Employment Trends Index (in blue) has declined in recent years. Historically, this has meant trouble for total non-farm employment in the US, which has not yet unfolded.
Third, the number of US states with a rising unemployment rate is spiking, meaning that the overall unemployment rate should see further upside.
And fourth, about five quarters after the US Treasury yield curve inverts (using the 10-year and 2-year durations), unemployment has historically started to tick up. April will mark the start of the sixth quarter since the yield curve officially inverted, which according to the indicator's founder, Cam Harvey, is when the curve stays inverted for a duration of three months.
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Posted on 4/1/24 at 1:18 am to rickgrimes
Guy said the same thing in 2022 and 2021. I guess eventually he’ll be right.
Posted on 4/1/24 at 6:01 am to rickgrimes
Been hearing this stuff for the last 3 years.
Rates will cause crash
CC debt will cause crash
Housing prices will cause crash
The exact reason I'm not in finance, because I thought the CC debt coming out of Covid until now would have caused a pullback, but I would be wrong.
Rates will cause crash
CC debt will cause crash
Housing prices will cause crash
The exact reason I'm not in finance, because I thought the CC debt coming out of Covid until now would have caused a pullback, but I would be wrong.
Posted on 4/1/24 at 6:59 am to rickgrimes
Not saying it wont happen but a lot of these guys have egg on their face for saying this a few years ago and nothing. I can say i see the market going down at some point in the future. Am i an expert? by no means but its going to happen at some point. 
Posted on 4/1/24 at 7:13 am to rickgrimes
The market is overvalued but no one knows when a correction will take place.
I have been saying the market is overvalued for 4 years - I’ll be right someday!
I have been saying the market is overvalued for 4 years - I’ll be right someday!
Posted on 4/1/24 at 7:28 am to FLObserver
The ole saying of experts have predicted 20 of the last 2 recessions
Posted on 4/1/24 at 7:54 am to rickgrimes
I think we are overdue for a correction but 50-70% is an 08 style collapse.
Posted on 4/1/24 at 7:58 am to rickgrimes
quote:
S&P 500 is set to fall 50% - 70% in the years ahead
Posted on 4/1/24 at 8:15 am to boogiewoogie1978
Sky is falling guys are always there
What has he been doing for 32 years?
What has he been doing for 32 years?
Posted on 4/1/24 at 8:19 am to rickgrimes
Looks like he is trying to sell his business
Posted on 4/1/24 at 9:11 am to rickgrimes
quote:A buy signal if I've ever seen one...
A 32-year market vet warns the S&P 500 is set to fall 50% - 70% in the years ahead
Posted on 4/1/24 at 9:46 am to LSURussian
Trump stock brought in $5m and lost $58 million
This going down only 50% would be optimistic
This going down only 50% would be optimistic
Posted on 4/1/24 at 10:14 am to Weagle25
quote:
The ole saying of experts have predicted 20 of the last 2 recessions
Does it count as a prediction if you keep saying it until it's true?
Posted on 4/1/24 at 11:01 am to KillTheGophers
lol yeah. There might be a 25% pullback AFTER it goes up another 50%. Or maybe not. Or maybe there will be a 30% pullback tomorrow. No one knows, but people who take their money out now are most likely to be losers in the market
Posted on 4/1/24 at 11:05 am to AndyJ
We'd need some massive black swan event to happen for the markets to drop 70%.
Posted on 4/1/24 at 11:17 am to rickgrimes
quote:
A sufficient catalyst, Woflenbarger said, is weakening in the labor market and a subsequent recession, which he believes is about to unfold.
A weakening labor market and a recession are inevitable due to needing a correction for the glut of stimulus and debt-creation during and post COVID. This is why all the talk of a "soft landing" is about as reliable as was inflation being "transitory".
I can't see the market dropping 50%-70% unless the consumer credit bubble bursts. Even then, the market is so optimistic that any use of trading "emergency brakes" would see traders quickly moving into buying mindsets (read: any losses would be made up). It would take a truly staggering event to cause enough pessimism to push the market down by that much over the many days and weeks it would take to circumvent the braking system.
Posted on 4/1/24 at 11:47 am to Lsut81
quote:
Been hearing this stuff for the last 3 years.
3 years? It’s been way longer than that. We’ve been hearing about this stuff for decades now.
Posted on 4/1/24 at 11:50 am to KillTheGophers
quote:
The market is overvalued but no one knows when a correction will take place.
"The market" is not overvalued. Have you not looked at earnings? There's only 3 sectors that didn't grow
Small-caps got hammered but most people have no exposure to those share prices.
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