"No warning can save people determined to grow suddently rich" - Lord Overstone

  • 6 hours Twitter CEO: The World Will Have A Single Currency
  • 7 hours Asian Currency Correction Could Signal Looming Crisis
  • 8 hours Best Buy Drops Telecom Giant Over National Security Threat
  • 9 hours The Pros And Cons Of The Federal Interest Rate Hike
  • 11 hours Good News For Gold Bulls Despite Interest Rate Hike
  • 12 hours Trump Hits China With $50 Billion In Tariffs
  • 13 hours Russian Gold Reserves Hit Record High Amid Rising Tensions With West
  • 15 hours Stocks Pull Back Following Interest Rate Hike
  • 1 day Will Regulatory Rollbacks Make Banks 'Too Big To Fail?'
  • 1 day Elon Musk’s $2.6 Billion Tesla Challenge
  • 1 day Tech Giants Could Be First Victims Of U.S. Trade War
  • 1 day Dow Gains Despite Fed’s Rate Hike
  • 1 day The Biggest Threat To Chinese Oil Futures
  • 1 day Spending Bill Could Cause U.S. Debt To Soar To 99% Of GDP
  • 2 days Precious Metals Slide Ahead Of Fed’s Interest Rate Decision
  • 2 days China’s Soft Power Grab May Be Bad News For Emerging Economies
  • 2 days The Secretive Wall Street Firm Betting On Bitcoin
  • 2 days ‘Data Is King’: The Oil Industry’s Next Most Valuable Resource
  • 2 days Google Invests $300 Million To Combat Fake News
  • 2 days Zuckerberg Dodges A Bullet As Facebook Loses Billions
The Pros And Cons Of The Federal Interest Rate Hike

The Pros And Cons Of The Federal Interest Rate Hike

The United States Federal Reserve…

Economic Pressures Weigh On Banks And Borrowers

Economic Pressures Weigh On Banks And Borrowers

Banks and borrowers are under…

Trump's Trade War Nears Boiling Point

Trump's Trade War Nears Boiling Point

Trump’s trade war appears to…

John Rubino

John Rubino

John Rubino edits DollarCollapse.com and has authored or co-authored five books, including The Money Bubble: What To Do Before It Pops, Clean Money: Picking Winners…

More Info

Whole Lotta Bear Markets Goin' On

The Dow and S&P 500 have fallen by around 10% since August, which in normal times would be hardly worth mentioning. But below the surface, in what used to be the market's hottest sectors, much more serious damage is taking place.

Biotech, which had an epic bull market during the era of QE and the Affordable Care Act, had begun to crater even before Hillary Clinton proposed price controls for pharmaceuticals. Last week it went straight down.

IBB Daily Chart

Solar stocks had a quiet bull market that accompanied the technology's emergence as heir apparent to fossil fuels. But now they're quietly crashing:

TAN daily Chart

Junk bonds, which are essentially the equities of highly-leverage companies (because they turn back into equity when the bonds default and reluctant creditors are forced to take ownership of the junk issuers) have tanked in the past few months and are now far below their 50 and 200-day moving averages.

HYG Daily Chart

One group that isn't plunging is the gold miners. But that's mainly because they had their crash while everything else was still rising, and are now at historically cheap levels. Here's an ETF that tracks the junior gold mining stocks:

GDXJ Daily Chart

What does it mean when several high-flying sectors crash all at once? If history is still a reliable guide (a big if in today's manipulated world) it means the internal structure of the market is deteriorating much more quickly than the behavior of the Dow and S&P 500 seem to imply.

When stocks in general catch up to the carnage in yesterday's hot sectors, we'll get something a lot more extreme than a simple correction. And when that happens the odds of the Fed raising US interest rates drop to zero.


Back to homepage

Leave a comment

Leave a comment

Sign Up For The Safehaven Newsletter