Higher Rates = Opposite of Lower Rates

JC Parets

March 16, 2024

Have you heard that stocks are going up in anticipation of lower interest rates?

Me too.

That's hilarious isn't it?

What about all those journalists?

Are they feeding you the same garbage?

Yup!

How about the Biden?

This guy is still the President of the United States. And he's telling you that rates are going down.

Have any of these people even bothered to look?

Or are they just lying to you?

Neither is an acceptable answer.

The U.S. 10-year Yield just went out yesterday at the highest weekly close since November.

What lower rates?

The opposite is what's happening.

The U.S. 5-year Yield went out at the highest levels since November as well.

So did Crude Oil.

Do you trust the glorified gossip columns?

Do you trust the Biden?

Or do you trust the Bond Market?

Here's a good way to look at it.

This chart below shows Inflation Protected Treasury Securities (TIPS) relative to nominal yielding Treasury Notes.

In other words, what the bond market is pricing in for inflation.

Not these bullshit government numbers. Not someone's opinion.

These are the facts.

Yesterday we saw the highest weekly close since early November in the bond market's inflation expectations.

It's not a coincidence that the CRB Commodities Index just went out at the highest levels since October.

The Bond Market is pricing in higher inflation.

Interest Rates are going higher.

Commodity prices are going higher.

And stocks continue to struggle.

The Nasdaq100 and Dow Jones Industrial Average are both stuck at the same price they were in early February.

The Russell2000 is at the same level it was way back in December.

There are stocks and assets working in this environment. They're just not the same ones that were working last year.

This is a much different market environment that the one we had in 2023.

Most investors are not prepared for it.

We have the data.

In fact, the majority of investors are positioned to take advantage of the opposite of what's actually taking place.

The Investors Intelligence Bull/Bear spread is the most bullish its been since January 2018, right before stocks all over the world got crushed.

Now, I'm not saying that stocks all over the world need to get crushed, but continued sector rotation into the types of stocks that investors DON'T own makes perfect sense.

And we're seeing it.

A lot of investors are about to get left behind.

But not us. We're here for it.

Bring it!

This Inflation and Higher Interest Rates theme is here to stay.

And we're going to be discussing it all this Monday night on our LIVE Conference Call for Premium Members of ASC.

Make sure to REGISTER HERE if you haven't already.

We'll get going LIVE @ 6PM ET.

March 18, 2024: Profiting From Inflation

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Cheers,

J.C.