Why the Doomers are Wrong Again or Let the Good Times Roll

by John Galt
August 5, 2018 21:50 ET

I’m back.

So what. Where have I been?

Unknown to everyone outside of my immediate family and company that I work for, traveling and engaging in operational and sales discussions which tell me that the prophets of doom, much like the shorts of Tesla (for now), are 100% wrong again.

That’s right ladies, we’ve got at least 6 to 9 more months of money for nothing, your kicks for free.

Am I saying the risk of a stock market crash in the next 90 days isn’t there?

Hell no. I predict a drop of at least 2,000 to 2,500 Dow points by September 30th just because a retest of the correction from February of this year is way, way, way overdue.

The problems in China and East Asia, the stagnation and stench known as the European Union, and the baffling buffoonery of Brexit all invite an accident causing a short term re-panic to justify a sharp retest of this year’s lows. However, as this bull market has teased, broken, and destroyed many a bear, the overall tension exhibited by the bears indicates that their overzealous proclamations that “this is it”, much like 2006, are a true case of premature bear ejacuspeculation.

After the upcoming retest and scare, I look for the Republicans to actually get their act together for the short term, support President Trump and allow his plunger protection team to re-inflate the market to new all time highs before the election. THAT will be your decades plus top however, and the real doom can then begin.

How can I declare this type of insanity and heresy in the ultimate doomer bear market community of which I am allegedly a long time member?

I’ve witnessed personally tens and in some cases hundreds of millions of dollars being committed by some seriously wealthy non-market married individuals and companies to the idea that this economic boom is not over yet. This theory should hold true for now and buy everyone anything from 9 to 18 months before the real pain begins. As the true pain of Federal Reserve inspired stagflation hits probably beyond the second quarter of 2019, that’s when the largest risk of recession will finally begin to be realized by the average schmuck and corporate America.

The bubbles are everywhere and still inflating. The bubbles are obvious to those who look. This is much like mid-2006 to early 2007 except the pain which is way past due to hit the financial industry has not begun. Once the shadow banking systems in China, Europe, and the good old USA start to bleed, that’s when the music starts and we start watching economic bloodshed unseen like anything in the last 110 years. Not to mention, President Trump is an expert at papering over losses so do not look for the US Treasury to accept any shortcomings in the economy or markets between now and 2020 without a PPT super-duper pump and dump re-inflation beyond the moon, Mars, and beyond.

Of course if I’m wrong, you can dump your cash into Knickerbocker (Citigroup) and call me full of crap in 2020; but beware, I wasn’t wrong in 2006 and I seriously doubt I will be this time either.

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