Treasury Market Indicator Signals Trouble for Stocks

By Dan AmossPosted February 5, 2020

One of the most powerful indicators of a recession looming is a yield curve inversion. As the yield curve continues to slope downward, the Fed will likely react by cutting short-term rates. This could bring another rise in stocks due to speculation, but deteriorating credit conditions could stall another rally.

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Jim Rickards’ Crash Speculator

Dan Amoss

Dan Amoss, CFA, tracks aggressive accounting and other red flags that markets miss. He’s a student of the Austrian School of economics and Daily Reckoning fan since 2000. Agora Financial relies on Dan for macro market commentary as well as profitable plays like his 2008 call to readers to buy Lehman Bros. puts, which...

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Conditions Are Ripe for a Crash

By Dan AmossPosted September 4, 2019

There are specific conditions where a market crash is highly likely to occur. This likelihood increases when most traders are playing similar strategies and have the same expectations for their investments. This creates a market that while setting new all-time highs, becomes increasingly fragile. When conditions abruptly change, bulls panic and prices can fall sharply.

Why PG&E Shareholders Own More Liabilities Than Assets

By Dan AmossPosted June 26, 2019

As PG&E goes through the bankruptcy process, shareholders will find the utility company’s assets are likely worth less than its liabilities. As a result, there’s a very good chance PCG stock will likely go to zero or a tiny fraction of its current trading price. Today, Dan examines its balance sheet and why assets aren’t worth as much as bulls expect.

How Bubble Logic Drives Wayfair Stock

By Dan AmossPosted May 13, 2020

Wayfair stock has skyrocketed in the past few months as consumers increase their internet buying during the pandemic. However, negative cash flow and ballooning debt will spell trouble for Wayfair when it can’t keep up its frantic growth pace after brick-and-mortar competition reopen and pop its stock bubble.

Warning: Investors Feel Bulletproof Yet Again

By Dan AmossPosted June 24, 2020

Investors feel bulletproof yet again, extremely confident that the bear market is over because “the Fed has their back.” But what ultimately “has the back” of bullish investors is the supply of new money that comes from other bullish investors. Yet that supply, which includes buying pressure from high-frequency trading, can turn on a dime once momentum shifts and prices can fall sharply as a result.

Paradigm Shift in Markets Could Favor Short Sellers

By Dan AmossPosted July 24, 2019

Investors expect the next round of Fed rate cuts next week will push Treasury bond yields even lower and stock prices even higher. But good returns are simply future returns being pulled forward by the “present value effect.” The danger is future earnings that are awarded a high present value often fall short of expectations during rate-cutting cycles.

Yes, Public Companies Can Still Go Bankrupt During QE

By Dan AmossPosted January 22, 2020

Many investors believe as long as the Fed is printing money through QE or repo lending, stocks are insulated and will remain bullish. But good fundamentals and consistent profits must happen for market gains to continue. Even though investor risk appetites are high even in credit markets, companies that are highly leveraged and burning through cash are still vulnerable to bankruptcy.