A relatively quiet week in the stock market while the world is waiting for “trade deals” is reasonable. As majority of the trading professionals are staying on the sideline, we have a new record of 21 weeks of consecutive weeks of inflow from retail investors into the stock market. If the short break in late December to early January is ignored, we have the longest inflow by the retail investors ever.
Is the worst yet to come, as claimed by some perma bears? Or is that this correction is over with new all-time-high coming soon?
Here is a more balanced view of what to expect down the road.
One thing that matters most for the world, is the news of Warren Buffett retiring after this year. The retirement of iconic figures are always omens to what is coming next to the world. When General Electric CEO Jack Welch retired back in 2001, that marks the end of US manufacturing and a new era of “financialization” of everything. Now that Buffett is retiring this year, I think the end of long term investing by fundamental valuation is here.
I find that the Spain blackout and the announcement of cash withdrawal punishment are potential alarming trends of what’s to come everywhere in the world. The infrastructures around the world have been aging over the years and majority of them are only maintained without modernization. So seeing bridges collapse, power grid blackouts and other man made disasters are likely to be happening way more frequently then the past.
The future of our world will be shaped by the relationship between US and China for sure. However, this relationship is very complicated. Sarah Paine sums it up nicely on what China wants.
BTW, my website is hit by several attacks these few weeks. In case you find that it is not accessible, just wait a little and try it later.
Time to go back to clear my inbox this weekend.
Have a great weekend all!
