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Comment by this_user | Hacker News Reader

> It is starting to get ugly.

Not really, to be honest. The SPX is still above the February high. We are merely back to were we were in October 2017 before the acceleration into the end of the year and the January rally. We're still up around 9% for the last 12 months. Q4 earnings have been extremely strong, and early indications suggest the same for Q1.

The looming risk of a trade war seems to have spooked the market somewhat, which has resulted in a re-pricing. But, as it stands, pullbacks are still buying opportunities here as long as we don't see a large scale escalation.

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I am far from an expert in these matters so I can only quote others who seem to know more.

Peter Schiff sounds like a gold salesman at times (he is afaik), but he makes the argument that rather than fixing the issues that caused the bubble that led to the Great Recession, the Fed and stimulus managed to only make it bigger. Now the market is burning itself up with expectations of economic growth under Republicans, but all they are doing is growing the deficit and putting the US deeper into a hole that it can never dig itself out of. Soon the US will be unable to acquire more debt and we'll do another round of quantitative easing, which could spiral into hyperinflation as we're forced to repay our debt by printing money. This will be terrible for the US because we've become a nation of debtors and consumers. He believes the coming recession will be worse than 2008 and that we are in the largest bubble the US has ever experienced, possibly never having even escaped the 2008 recession in the first place.

He believes all this will come due before the end of Trump's term, probably within a year or two. I've heard other famous investors say a recession is likely to begin next year.

These might not be in order of when he spoke:

https://www.youtube.com/watch?v=1Fd58n4HhAM

https://www.youtube.com/watch?v=WD2zcyfwdJ4

https://www.youtube.com/watch?v=5DuHWGh2GgU

https://www.youtube.com/watch?v=03Ke9rIYGsc

The OP is saying 'there are icebergs ahead', and you are saying 'lol, nothing to worry about, we are moving at record speed!'.

The recent market volatility has more to do with the debt markets than near term quarterly earnings. No one really knows how the messy combination of tax cut fueled growth, trade wars, inflation (or lack of), fed rate schedule, record US deficits, and unwinding QE will impact markets, but the general consensus is that interest rates are going to rise. The question of the day is 'how fast?'. Too fast, and it will hit the brakes on the economy. Too slow, and we may overheat (if we haven't already).

SPX is down 7% from the February high. Are you referring to the February 2017 high?

Looking from a yearly perspective, we've gone from a period of slow, stable growth to a period of uncertainty and loss, with a doubling of volatility.

I think it's just as reasonable to call this the beginning of something ugly, as it is to say it's a buying opportunity.

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