🍔Nasdaq Entered Correction; Is The Bottom In Yet?
We moved to cash before the selloff came
Investors,
We started switching into cash on Feb 24 when the SPX broke $6000, as shared here with premium subscribers. Since then, the S&P500 dropped -8% from the highs and Nasdaq -11%. This is how we protect our capital. If you or your financial advisor is just doing “buy and hold”, then you’re doing it wrong.
We are in a complex period with mixed signals from economic deterioration, tariff-induced inflation, and minimal guidance from Fed policymakers. Stocks just suffered their worst week in six months as an avalanche of geopolitical and macro-economic headlines met an ugly technical setup.
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In today’s piece we’ll discuss whether it’s time to buy the dip, or whether stocks have further to fall.
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What worries me the most: I’ve been watching markets for a long time, and I can tell you - there’s something unsettling about what’s happening right now. We’ve seen bubbles before. We’ve seen euphoric rallies. But this? This is something different. Read more here.
Canada vs US trade war
There’s been a barrage of tariff headlines between these two neighboring countries, but to forecast the outcome requires some context. Strategically, Canada is in a weak position to fight a trade war with US, due to its political fractures and economic dependence on foreign trade. Let’s understand why…
Canada is a trading nation; two-way trade accounts for 2/3rds of GDP. Canada exports $1T of goods and services a year, 77% of which goes to the US. A fifth of Canada’s GDP depends on the US. Conversely, 2% of USA’s GDP flows to Canada. That’s a huge disparity that allows the US to inflict 10x the economic harm than the other way around. If the US completely cut off Canadian goods, Canada would be crippled but the US wouldn’t flinch.
The reasoning for the tariffs is cited as fentanyl imported across the border, but this is bogus…
The rest of this article is for paid subscribers. Upgrade now to continue reading:
How the Canada/US trade war came to be
History of market pullbacks
Important macro-economy update
Job market crashing too
Trump “Put” is not real
Where’s the market going next?
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