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Prognosis Negative: Congress, The Fed, and Geopolitics

The markets continue to defy gravity. Nearly every day they've been reaching new highs. I'm concerned, and have been for a while. There's an awful lot of complacency permeating the market currently. I believe the day of reckoning is approaching, likely before August concludes, but probably no later than mid-September. I think a correction of 10% magnitude wouldn't be surprising, but I'm guessing more like 7-8%. Whatever the actual quantification, there will be an unraveling. Don't freak out - it's long overdue and should provide a nice selective buying opportunity.

There are several factors coming to the fore that I think alone or in combination could be the catalyst for a market decline. Let's examine a few of them briefly.

First, the market has been on a tear without any meaningful pullback. A big early part of that was Trump euphoria. The new administration made bold promises that many believed would help stimulate the economy. Those promises include…

Filtering The Noise

It's been said, "Information is king." True enough. We live in an age where technology has made information accessible and abundant in real time. That's good, to a point. The problem arises when there's too much information. It's a 24/7 information bombardment now. It's all urgent too, or so it seems. Even the weather is a full-time breaking news event. Added to that, every Tom, Dick, and Harry (and even some upstate guy named Mike) has an opinion on what it all means. And those opinions run the gamut from one polar opposite to the other. Ever watch CNBC? Then you know exactly what I mean. The truth is that the vast majority of the information we're pummeled with is Noise.

Noise? It's the stuff that's irrelevant in the grander scheme of things. It's a distraction. Many times it elicits emotional responses, like fear. It often seems so important. It's not. Don't get distracted.

The trick to effective trading decisions (or any decisi…

Who I Am

Hello...and welcome to my newest blog endeavor, The Market Chronicle. I'm excited to share my experiences and insights after more than 30 years on Wall Street, mostly as an equity trader. First and foremost, I'm a trader, not an investment advisor so anything I post that resonates with you should never be construed as investment advice. There are plenty of capable people to seek advice from and I'm more than happy to point you in the direction of a few if you need specific advice.

Initially, I expect to cover broad topics to include the inherent unfairness of the modern fractured marketplace, the effect of technology, and regulation. These views won't be white papers that cause your eyes to glaze over but rather my perspective after surviving in the market trenches for decades. A lot has changed since I began and I imagine a lot more will change before I'm all through.

Before we get to all that, it's probably useful to introduce myself by way of my background. …