Inflation, Recession or Depression, that is the question?

Posted on by The INO.com Team

Whether it is nobler in the minds of ... O.K. lets give Shakespeare a rest and get down to reality.

Inflation, recession or depression, what if I told you it doesn't matter?

In the next twelve to eighteen months there are going to be some amazing opportunities in the markets thanks to Europe and the upcoming economic climate. The opportunities I want to talk about today will only be available for those who are prepared to take advantage of a very special time in history.

DOES HISTORY RING A BELL AT THE TOP OF A MARKET?

No way! So how do you figure out when the tide has turned for the economy and we are headed towards a recession or huge inflationary pressures.

Unfortunately, you don't receive a personal email from Fed Chairman Bernanke giving you a private warning that the market is going to hit the fan.

So how do you know, how do you prepare yourself?

Here's how the two camps analyze the markets.

There are two camps that most traders fall into when the question of market analysis comes up. Either they are fundamentalists or they are technicians.

At this point I have to admit I am a market technician and I am proud of it.

The fundamentals are usually well known to most investors. What isn't known is how much of the known fundamentals are priced into the market. Now that's the dilemma facing most fundamentalists. When is it time to get out ... exit the market, and head for the hills?

A technician on the other hand relies on price action to determine his views. The price action of any market is the biggest single most important indicator in any market technicians toolbox.

Market action is the sum total of all the greatest money managers in the world. What could be better than that ... having thousands of these great traders and investors around the world contributing to and working for you and your bottom line. Using technical analysis gives you this and a whole lot more. Is it perfect? NO, it isn't perfect but using the right tools, filters and a disciplined approach it will consistently out perform most other market approaches.

If nothing else technical analysis and MarketClub's Trade Triangle technology can prepare you for the future with confidence.

All the Best,

Adam Hewison
President of INO.com and Co-Founder of MarketClub

P.S. Please feel free to add a comment on what you think. Thanks, Adam

15 thoughts on “Inflation, Recession or Depression, that is the question?”

  1. Yes, and there is also another headand shoulders/ triple top on this chart from 1968 to 1977 at 1000 Dow.
    After another go at 1000 in 1981, the rest of the chart brings us to today.
    Also note the progressively higher lows at 747, 763 and 784...
    So, watch fro a break of Dow at 10777, otherwise we are going UP!
    I remember trading the markets when we got to 2000 Dow...

  3. Re: The "gold is a bubble crowd neglect one thing. If it's in a bubble, it's the only bubble in all of history that no one has participated in.

    Less than 0.5% of global equity assets are dedicated to precious metals. You can find very few of your neighbors, family and friends who look wild eyed at precious metals like they did tech stocks 10 years ago (and still do"

  4. Deflation is just not real world for those of us who face 15% annual increases in health care premiums, college tuitions and more. Real world grocery store prices are anything but deflationary, as are restaurant prices, utility bills, clothing, gas, autos and related mechanic expenses, dental bills, furniture, pet care, airline tickets, on and on and on. To those of us who actually operate in the real world, well, let's just say the "official" CPI figures appear to have originated from old Soviet Politburo blueprints.

    We were all told everything was going into long term deflation during the Asian/Russian collapse of 1997. We all know what has happened to prices across the board since then.

    US dollar not actually going up, all currencies are in a race to the bottom, it just "looks" better than others for the time being. It's in a long term secular downtrend. Can't pay your bills, massive debt..... your currency will drop over time. US dollar no different.

    Technical vs. fundamental? A lot of us imcorporate both, vs. totally excluding one for wrong reasons. There is also sentiment, the third leg of the stool. Use all 3, be objective.

  5. The US dollar is going up because it's in short supply, believe it or not. The world still believes it's the safest hiding place left for now. It's about return of capital not return on capital.
    Do you really think China would take IOU's from us in Yuan?

  6. Robert, u haven't a clue what u r talking about. Government, taxation and duties r what destroys an economy. We need substantially less gov't and certainly no special duties against any one country. Why would I manufacture a product in the states when there r several more friendly and competitive options available ? The problem is government and the banking system, not china.

  7. Davies, smack on, unfortunatey 🙁
    Nothing but cash, gold and silver will be safe in my head. If china and India r not careful, they will get sucked down the drain as well.

  8. Yes, a deflationary depression will occur until our dumb, deaf and blind government recognozes that if they close the door to cheap chinese imports (which is the absolute cause of our jobs having vanished and our savings having been depleted) we can start growing again and creating jobs. Within a year after significant duties against chinese imports are instituted, jobs will reappear and the start of serious, lasting inflation will unleash itself. The good aspect is that employees wages will rise and they will be able to better afford the costs of living.

  10. Have you looked at 52-year (1960-Present) charts of INDU & SPX? If not, you can find them @ http://stockcharts.com/freecharts/historical/djia1960.html. You can perform your analytical magic on them and, PLEASE, publish your findings here. To us, (my wife is a chartist} it looks like it is DOWN from here.
    The ONLY true refuge for our money is GOLD and silver, with platinum and palladium added for good measure.

    1. Carlos it looks to me like were about 3/4 of the way through the 20 year bear use your wifes charting skills and enjoy the ride.

    2. Carlos, looking at head and shoulders or triple top? If that is the case, you are right on the money.

    3. Thanks folks. YES, that is exactly what we see: either a head and shoulders or a triple top, depending on volume confirmation.

Comments are closed.