Benjamin Roth: The Great Depression: A Diary It's all here, times change people don't
-the endless govt programs that fail to stimulate the private sector
-the ups and downs of the economy, the veterans pension stimulates just as the housing credit did, until of course the money runs out
-Roth is a attorney in Youngstown Ohio who kept a diary regarding the economy from 1930 until WW II breaks out, he is objective, candid, and forthright which is more than we get from Washington DC now or then
highly recommended
Markets move in five waves, In a bear market wave one is down and it just completed Thursday. Markets had vigorous rallies to the upside starting wave two up.
The next charts will show the topping action of the major indexes, we can now be fairly confident THE TOP is in place.
Wells Wilder did pioneering technical work in the 1970s. One of his warnings was always invest WITH the major trend of the market. If you are wrong on timing it will eventually bail you out.
I let the February top get away from me but it is clear that te MAs all crossed down just prior to Feb 24 and it was all to the downside after that.
Still we are early in what will be a ferocious bear market. Now we can buy bear funds with more confidence. Wave two can be shallow or strongly up but still we can begind scaling in positions as market gets short term over done and bear funds sell off.
Here are double tops in SPX, INDU, NDX setting up the same pattern as March 2000 and Fall 2007.
Here is SH the S & P short ETF, and it is just starting to correct. The sell off of wave one took about a month. This down wave two should take a week or two.
I will post more this weekend.
Bonds
I placed orders under the market for TBF the bear bond ETF. I got positions at favorable prices as the bond market advanced as the stocks sold off, sellers ducking into bonds of various maturities.Still TBF is advancing and TLT is falling.
The media claims that interest rates are the highest for quite some time, ignoring the sky high rates of the late 1970s and finally the high of 1981 around 14% for mortgages and higher still for Treasuries.Today the amount of Treasury debt dwarfs 1981 so expect rates to eventually soar way higher than the 4.3% of ten year T notes today.
the political polarization today matches that of 1973-74. First the press hated Nixon just as they hate Trump today. Second the market topped in January 1973, pretty much the same with averages topping from Nov 2024 thru Feb 2025. Mood is already negative, expect it to become far worse, check out this image from a recent protest.
Wiliam Devane finally has his day. The well-known actor is now a pitchman for a firm selling gold and silver. As he points out the US debt has only exceeded the gross domestic product twice, in WW II and now. While those firms tout gold coins as a s store of value, they talk about the ask price but never the bid, what they would pay to buy the coins back. As paper assets fell across the board, gold finally hit $3,000. But not so fast. Suppose you try to buy say $2,500 of appliances at the big box store with your one ounce gold coin? Will the store accept that as legal tender? I doubt it. Someone will have to assure it really is a gold coin, not a gold covered piece of lead. As mentioned, what is the bid ask spread, what will the store do with the coin? The better idea if this is your choice would be the Sprott family of precious metals. You invest in a secure vault of the metal at market prices. I checked and Sprott’s physical gold trust is still selling at a discount to its net asset value, that is a deal you will not get from any coin dealer.
The NYSE advance decline line has reversed to the upside just shy of its January low. Expect a week or two of rally in the markets.
Is the turmoil all due to the tariff wars? No in fact, not at all. Trade wars are affirming the technical picture but there is much more going on. The Dow Theory, constructed about 1896, holds that the Transports and Industrials must confirm one another. If one makes a new high so should the other. This has not happened. The Transports peaked in Fall 2021 and have not posted a higher high since. Individuals earning $150K annually n ow average 90 days delinquent on credit card payments. Business layoffs continue.
Interest rates have been steady as stock sales moved into Treasury bills and bonds. Interest rates should now move higher.
Crude oil managed to hold above $65. That has not turned the trend back to the upside.
This rally will allow the Tarif crowd to claim yes there will be minor pain but greater gains ahead. Nonsense, other trading partners are retaliating with their own tariffs. This is a sledge hammer approach attacking all manner of goods rather than specific items. And our trading partners are not likely to forget this anytime soon.
This is the most reliable indicator. It is closing in on the December January low. Charles Payne's screaming buy has not developed. Today he was on with stock charts hoping the next low would hold. This is probably the best chart to watch.
Bonds have not sold off, money coming out of the stock market is going into t bills and notes and bonds and so no sell off, ok I am fine with a modest bear position.
Transports lead and are down 18% since the November high. now starting on a third wave down. The only question is will we get a one or two day rally or a one or two week rally in stocks? MYSE weekly advance decline line has turned DOWN
TLT has topped I will buy some puts and TBF
TBF has printed twice sorry bout that but does not show at the moment on my screen.
As said time to accumulate bear funds as market rallies whether a day or two or a week or two, today was remarkably weak but more tariff exchanges no wonder
How long will Trump continue this on and off again as the market falls, I wonder, how long until House Republicans up for re election in 2026, say no way.
I Will start updating more often check in intra-day
WSJ Heard on the Street editor Aaron Back explains why investors are alarmed by President Trump’s rhetoric on the economy and trade. Photo: Josephine Chu
American consumers and their credit cards have helped the U.S. economy weather many rough moments. Now, as recession fears resurface, the worry is that they might be maxed out.
were all down more than 4% on Monday. So far this year those four are down an average of around 12%, compared with a 4.5% fall in the S&P 500.
This isn’t the first time consumer lenders’ stocks have borne the brunt of economic concerns. At several points in the past couple of years, surges in late payments or in banks’ charge-offs of consumer loans have sent consumer lenders’ shares tumbling; charge-offs are loans that have been written off as a loss. A big worry is that if Americans aren’t paying their debts, they won’t be able to spend like before—removing a critical pillar of the economy.
Those recent incidents were often false signals. Rising delinquency rates were in many cases concentrated among certain groups of borrowers, in particular people who took on a lot of new debt during the years of 2021 and 2022. During that time, many consumers were able to borrow more than they usually could because they were flush with stimulus payments and the savings forced on them by lockdowns. Many banks have since made it harder to get cards.
Now, a lot of those bad debts are being finally digested and worked through. Moody’s Ratings projects auto-loan and credit-card loan charge-offs are actually set to decline, albeit very modestly, in the latter part of this year.
Yet investors suddenly have fresh concerns. For one, Americans’ inflation-adjusted debt burdens are starting to grow further beyond prepandemic levels on a per-household basis. As of the fourth quarter of 2024, the average household’s credit-card debt surpassed $10,000, adjusted for inflation, for the first time since 2009, according to data compiled by consumer-finance website WalletHub.
March-22.5-20.0-17.5-15.0-12.5-10.0-7.5-5.0-2.502.55.07.5%S&P 500 banksCapital One FinancialSynchrony Financial
Then there is the rising risk of an economic downturn, or even an outright recession. Investors are clearly concerned about the fallout from President Trump’s tariff policies. The market’s alarm level only rose on Monday after administration officials and Trump himself signaled a willingness to accept near-term pain—in the markets and the economy—to achieve long-term aims that are less than clear. Treasury Secretary Scott Bessent said the economy could need “a detox period” to reduce dependency on government spending.
Lenders often say that the biggest input on their credit modeling is employment. Whatever is happening with economic growth, or stock prices, so long as people are working they are likely to keep up with their payments. So lenders could be sensitive to job losses, even if they are concentrated among federal workers or people who work in sectors that rely on imported goods.
Amid economic stress, credit cards and auto loans may also suffer from consumers’ changing debt-repayment priorities. Rising home prices and superlow rates on mortgages taken out during the pandemic mean consumers might be more reluctant than ever to lose their homes, meaning that mortgage payments might win in a budgeting battle. The prioritization of mortgage debt, as evidenced by a sample of consumers’ behavior, has recently been higher than at any time this century, according to research recently published by the Federal Reserve Bank of New York.
Big consumer lenders’ results only represent a slice of the U.S. consumer economy. The most economically vulnerable people, such as those receiving government benefits that may be cut, may not have credit cards. They also may rely on smaller, specialized auto lenders for car loans. These consumers are also the ones most likely to have their budgets thrown off by higher costs for imported goods such as car parts.
These economically marginal consumers represent a smaller slice of spending, especially on discretionary goods and services. What would be especially worrisome to the broader market, then, would be delinquency rates rising among higher-income consumers.
An economic reversal could lead to an especially sharp pullback in spending. Photo: John Taggart for WSJ
From January 2023 to January 2025, the rate at which people earning $150,000 or more a year are 60-to-89 days behind on their overall debts has more than doubled, according to CreditGauge, which is produced by VantageScore, an independent joint venture of the three major credit bureaus. Those late-payments are still far lower than for other groups, at just 0.16% of outstanding balances. But the jump well outpaces the rise for the middle-income tier of consumers and the lowest-income group.
Industrials are over sold but RSI and PMO have yet to bottom. While the media blames Trump and tariffs, yes that is a qualitative reason but it just validates the five waves up are done going way back to 1932. Business news is moving from screaming buy (Charles Payne last Thursday) to 15-20% sell off. Industrials are down 4,000 points about 8.8%. NDX is down 13.6% already.
This is a repeat of the dot.com March 2000 sell off and the sub prime in 2007.
March and June bonds sold off 31/32 today. TBF is a bear fund that rises as bond prices fall.
TBF has filled in the gap from around Feb 23 and is turning up.
TLT a bond fund is the exact opposite. I rarely recommend an option play but June puts on TLT look attractive.
Crude oil struggles to find a bottom, short covering in energy service, so not sure if we have a low in oil yet.
Yes I said that last summer and again in December and again in January and finally yes I am right it is here!
I commented in my newspaper column Friday that you would never hear Charles Payne say the market is a screaming sell, which it was last Thursday, Instead he said it was a screaming buy, really, take a look
Markets fall seven times as fast as they rise. Yet the sell off is orderly with no internal signs of panic so the sell off despite being oversold is likely to continue.
Notice the 'experts on business tv looking for a buying opportunity, no this is all a selling opportunity, any rally should be sold via bear funds.
SH PSQ BEARX, HDGE
Bonds
TLT has rallied to a second wave high, and TBF is about to rally, I have limit buys in for 23.37 in TBF
I am going to suggest a rare trade for me and that is puts in TLT
It is imperative to understand that bond prices topped in March 2020 and interest rates bottomed in a 39 year cycle at near nothing. All that is reversing and TLT is making another short term top now. Stay tuned.
The trend in stocks is now down. Like 1973 the bear market has begun in January. I have mentioned other similarities in the weekly newspaper article.
Press hates the Republican who was re elected
Stock market all time high
P)resident makes lots of promises
Auto industry struggles with emissions, now with EVs
All are over sold short term but the market fell on Thursday instead of rallying and never did Friday until Powell gave reassurance on the economy.
Rates are rising, buy TBF
Markets do not like uncertainty, Trump has loaded the boat with just that, now Musk falls out of favor with liberal elites who took pride in being green buying Tesla
I suspect shareholders will take a a dim view of his White House antics lowering the stock price
