Running from the Guillotine (QQQ)

 

When the guillotine falls, friends, it pays no mind to whether the neck below is righteous or wicked. So, too, the slice of the surgeon’s scalpel, restoring life when disease or danger threatens – what does it care a man’s past.

 

There’s an order to this world, comrades, and the knife’s edge is but a small part of it. Like gravity. Like sunrise and sunset. So, too, the knife.

 

So whether we end up shackled in front of Robespierre’s hordes or swabbed and etherized on a table is not always in our hands. We have to choose well, to be sure. We have to see ahead and plan for whatever is ours to plan for. And we have to pray for the grace of a divine providence that often measures ‘good’ with a different calculus than we’re used to.

 

And so it is with financial markets, as well. Without an appropriate blend of foresight and caution, without a healthy understanding of risk mixed the courage to assume it, and without some comprehension of the broad phenomenon we call reality, there will be no profits to be had. And certainly if the forces of heaven are opposed… well, one may as well board the train to Merrick with Claude and Julien.

 

Train wreck

 

 

No one rides the road to riches alongside the masses. It’s simply not a group activity. Wealth creation is a matter of intense toil and unparalleled focus. It comes to those, again, who are prepared to take the road less travelled, who strain against the yoke of society and make the decision – unpopular in the extreme – to follow the truth as they see it, come what may.

 

Damn the torpedoes!

 

Here at Normandy Research we believe that a time of great historic reckoning has come. We believe that the current crossroads is one that investors will never have the opportunity to avail themselves of again. The time to step to the plate and swing for the bleachers is upon us, and if you have the fortitude, if you’re ready to cash in on the final unprecedented blowoff market top that’s nigh present, then it’s your time to shine.

 

If you aren’t worried about missed opportunities, of course, that’s your affair.

 

For the stock market will enter a new dimension as of this Friday, friends, that no one expected and precious few could foresee. The outcome of the new era is also known to those who have the ability to take history’s measure and weigh the probabilities that emanate therefrom.

 

Roller coaster

 

There will be a price to pay for what’s about to ensue, to be sure, but for those who plan for it and are aware, the results will be less ominous.

 

But before that day arrives there will first be an equity explosion, one last gasp by the current establishment to hold fast to the winnings they’ve acquired over the last half century and to avoid the inevitable wealth destruction that will ensue.

 

They will employ all means to save their financial souls, via the central banks, via the commercial banks and brokerages, via means both ethical and corrupt, via mainstream marketing and back room shenanigan, with no avenue left untrod in their effort to preserve the status quo. And all will be done with the transparent aim of goosing our beloved equity market higher.

FRED Graph

 

There are a number of reasons they will do this, the most formidable among them being the effect a rising market has on the average American, whose spending habits are exaggeratedly affected by the rise and fall of the stock market. The chart above demonstrates that relationship rather picturesquely [S&P 500 vs. Personal Consumption].

 

And because the spending must continue, so the S&P must rise.

 

Because when the index stops rising, the average American’s anger starts to rise in its place. And when that anger reaches its peak, poppa’s gonna buy you a guillotine.

 

The American Reign of Terror

 

America was founded on a rejection of elites in far-off places profiting from an unjust political and socio-economic regime, and that sentiment remains strongly embedded in the hearts and minds of average Americans. It will no doubt grow stronger when their bread is taken from them.

 

Circle

 

 

But first it has to be given to them. And that is what is about to happen now.

 

The Ultimate Contrarian Wager

 

There is no one in the mainstream financial press, the Wall Street analytical cult or the financial blogosphere underworld other than Normandy Research who is pounding on the table that we are presently on the threshold of another 30% to 50% rise in the major market indexes and that equities MUST be bought.

 

Nobody.

 

There is no one out there arguing that the vast ocean of liquidity injected into the financial system over the last decade by every central bank on the planet is about to stream rapidly into the equity market.

 

But that’s exactly what’s going to happen. And it will occur as a knee-jerk response to the possibility that the punch bowl is about to be hauled away.

 

It will be a form of financial suicide, undertaken to ward off a potential physical homicide. That is, the fear that elites feel over the fate that awaits them at the hands of the hoi-polloi will send them careening for an equally disastrous course of action.

 

They will jack the market higher by all means available, engendering a bubble and attempt to flee while the walls come a’tumbling down.

 

Will they Succeed?

 

We will succeed. We are trading for a grand bullish finale here. We’ll advise you when to sell and where to deploy your funds as the market rolls over.

 

In the meantime,

 

 

Big picture

The NASDAQ is the place to be.

 

[mepr-rule id=”994″ ifallowed=”hide”][mepr-unauthorized-message][/mepr-rule]

[mepr-rule id=”204″ ifallowed=”show” description=“options_trader_elite_members_only”]

Options Trader Elite recommends you purchase a deep-in-the-money QQQ January 2017 60 CALL, now trading for $49.74.

[/mepr-rule]

Many happy returns,

 

Matt McAbby

See what people are saying...

  1. Ennio D'Angela

    Hello Matt:
    First a compliment re your past gold forecasts. It made me a lot of money. I am no longer a gold bull but I have been trading the swings in gold very successfully.
    Thank you!!
    Regarding your forecast of a melt up in stocks and then a significant melt down, I have to say it is not unique. Jim Puplava of the Financial sense NewsHour has had the same forecast.
    I would be interested in better understanding the scenario to justify why all this money will pour into stocks. The prevailing thought is that as interest rates rise money will come poring out of bonds into stocks. I would appreciate your thoughts.

Share your thoughts...

We encourage people to join in on the discussion. Please keep in mind however, that all comments are moderated according to our comment policy, and all links are nofollow. Let's keep the conversation professional and meaningful.