Here are a few reasons for an intermediate bull market during the midst of the primary bear market. I remain very skeptical that this market can turn itself around and head higher, however, I must realize that their are two sides to every coin. Enjoy.
my assessment may sound absurd but it looks as though the bear-market ended late last year and we are now in the early stages of a new cyclical bull-market. Below are some of the reasons why I believe the skies are clearing for a 4-5 year bull-market:
- Surging liquidity – central banks have pumped trillions into the banking system
- Low-interest rates – yield on cash and cash equivalents is at a historical low
- Declining corporate bond yields– risk appetite is returning
- Declining Ted Spread – inter-banking lending rate has declined, a positive sign
- Low valuations – various stock markets are trading at very attractive multiples
- Horrendous investor sentiment – a contrary bullish indicator
- Volatility has peaked – VIX has topped out and is falling
- US Dollar rally has ended – bullish for the markets
- Global stock markets are making higher lows – sign of base building
- Huge amount of cash on the sidelines – US$8.85 trillion or 74% of US market cap
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