“Spectacular Bull!” “Terrifying Bear!” What Comes Next Is Anyone’s Guess
Since we are in the Thanksgiving lull of the “markets.” I wanted to express something that takes place in my own head around these times. Where I (and believe others) may also share some of the same conflicted feelings as we not only try to give thanks, we simultaneously ponder thoughts to what the future might portend, and how we are going to move with it. For in the game of business as is life: the decision process never rests.
I used the term “conflicted” for a reason. If you’re anything like me (and I believe we’re all the same, it’s only how we deal with things that makes all the difference) they run the gamut from not just the good or bad, but some may range from the exuberantly spectacular – to the down right terrifying.
Then last, but certainly not least, buffeted with either a single-minded focus – to outright scatter-brained confusion, notwithstanding the myriad of combinations of some, if not all of them at once.
Nobody knows what the future may portend. Everything (and I do mean everything) is a best guess with whatever evidence you have at your disposal; a willingness to believe in your gut, and your abilities; and the willingness and fortitude to live with/by your decisions. That sounds simple enough, yes. However, it’s in the application, and the willingness of follow through, which makes all the difference. That’s the hard part.
So why am I making these observations today one might ask? Well, it all started the other day when I received a note from a colleague questioning my thoughts after they read the following headline. To wit:
Their question? “Have you rethought your call about the Fed. in December? It would seem you’re not just in the minority: you are the minority!”
It’s a fair question, as well as a point. However, with that said: No. (as I’ve previously stated I’m currently 85/15 favoring that they won’t.)
This isn’t some form of relentless death-grip to be contrarian just for the sake of it. Far from it. Rather, I am becoming even more steadfast in that position based on what I believe or “see” as compelling evidence that the Fed., regardless of what it may want to do, will have their hands tied (once again) by “international developments.” e.g. China.
Whether or not that turns out to be correct is anyone’s guess. For it is all guessing, no matter who says differently.
Yet, here is where a “spectacular” bull____ run up in “markets” may turn into a truly “terrifying” off-a-cliff stampede should just one metric change. That metric? The Yuan.
As I sit here today typing, the Chinese currency is not only still in free fall, it is resting precariously so close to the “cliffs edge” (e.g. 7.00 USD/CNY) if it falls over – it will take all markets with it. Emphasis on all. For if one thinks Aug. of 2015 was scary? Let me use this for analogy:
Aug. 2015 will look like a kiddie rollercoaster as compared to what the “markets” newest amusement park has constructed in the last few weeks if it all goes awry. And China – not the Fed. – is the one contemplating on whether or not it will open sooner, rather than later. And the clock is ticking.