The Keystone Speculator's Housing Market Indicator signals the start of a housing recession. Say what?! The talking heads on television as well as the Wall Street fat-cats say the economy is fantastic, the housing market is steady and fine, all is great with the US and world especially considering the never-ending global central banker collusion and market intervention.
7 years and 5 months ago, on 2/16/12, Keystone called the housing market recovery. The homebuilders had gapped lower and housing market doom and gloom was rampant. Many believed the housing market would never recover after the 2008-2009 financial crisis. Of course it is always darkest before the dawn. Traders thought Keystone was smokin' something with such a bold call back then but that is what his proprietary data showed.
In a few short weeks, the XHB homebuilder ETF had recovered and analysts were beginning to step aboard Keystone's housing market bandwagon as it rode through town. In a few short months, everyone was on Keystone's side and the housing market recovery expanded and the joy continues up until......Wednesday, 7/17/19.
The housing recession now begins, on 7/17/19, after a long 7-year-plus recovery.
The only caveat would be to watch the housing data over the next two months for confirmation, or perhaps non-confirmation (confirmation of a reversal of trend would be expected to continue). In early 2012, when the indicator flipped bullish, indicating the housing recovery had started, that turn occurred on a dime and the indicator never looked back, so the same may occur as the housing recession now begins.
A jog move of a couple more months with the data would not be unexpected but the writing is on the wall. Even if the housing permits, starts and other data would catapult higher in earnest, it will likely not be enough to reverse Keystone's indicator. For example, the next release of Housing Starts would need to register 1.7 million units and higher to avoid a housing recession and that is not going to happen. We are going into Fall in 3 short months in the northern hemisphere not exactly the time to be breaking ground on new houses and apartment buildings.
Interestingly, the end game is likely approaching for the corrupt global central bankers. Markets can only be goosed for so long with easy money. The wealthy privileged class, that is well-represented with media cheerleaders, that tout the capitalism system (which does not exist in America it is actually a crony capitalism financial system), will often quote Margaret Thatcher who said, "Socialism fails when you run out of other people's money." It is ironically funny that America's crony capitalism system is now on its last legs, and entering the last stage of failure, since it is 'running out of its own and other central banker's money'.
All financial systems and governments throughout history typically fail after the 200 to 250-year mark. This occurs because humans are corrupt and greedy animals. The other major problem is that transparency in government and with companies does not exist no matter how much it is touted and cheered by the criminal politicians and CEO's. The wealthy hide their nefarious endeavors easily. It is great to be rich and in control.
Former Federal Reserve Chairman Bernanke started this sick path forward for America, in support of crony capitalism which protects the wealthy privileged class, in March 2009. The central bankers have held the wolves at the door for the last decade and 4 months but how much longer can they hold out? Housing and autos are the two major components of the economy. Peak Auto has likely occurred and with the housing recession now starting, the future looks bleak. Overall economic recession will likely begin this year or early next which will kick off a class war in the United States.
If you are a young person, think long and hard about any long position you own in the stock market. You will likely lose money over the next year or two perhaps one-half or more of your capital. It is likely wiser to simply sit out of the stock market for the next year or so and see what happens. You will likely be a very happy camper down the road and then take that cash hoard and buy top-notch companies on the cheap, just like the smart investors did after the 1929 crash.Anyone holding lots of cash was king; everyone else lost their shirt.
The SPX prints an all-time high at 3017.80 on 7/15/19 and an all-time closing high at 3014.30 on 7/15/19. Last year's epic high before the crash was 2941. So after nearly 10 months, the S&P 500 has gained a whopping (said cynically) 77 points, or +2.6%. Understand that investing in the stock market now is akin to picking up nickels in front of a bulldozer. Sure, you may see a few more percent of upside, but is that worth the risk of seeing downside at -20% to -80% over the next couple years for your capital? You decide.
The Keybot the Quant algorithm, Keystone's proprietary trading model, incorporates the housing market indicator into its programming so the start of the housing recession is a serious black eye for markets going forward. This information is for educational and entertainment purposes only. Do not invest based on anything you read or view here. Consult your financial advisor before making any investment decision.
