Is this a short-term issue or signs of a bigger problem to come
 
   
     
   
 
JANUARY 8, 2024
   
Hey y’all,

As I’m writing this, at 10:00 AM on Wednesday morning, the markets seem headed for another lower day, their third in a row to start off the week.

But if you broaden the lens a bit, this isn’t a recent phenomenon.

The markets have been stuck in a more-or-less sideways trend since the initial spike after the election, unable to breakout above the all-time highs a little above 6,000, but also unwilling to give back the gains made in the immediate aftermath of Trump’s victory.
 
 
 

I asked Chris Pulver what’s behind this uncertainty, and he gave us a laundry list of reasons. 

Here’s what the mastermind behind the Daily Profit Play had to say:
 
• Uncertainty with Trump and Republican agenda (leading with financial TO DO's or Tariffs and Deportation?)
• Bond Market Falling Aggressively / Bond Yields rallying aggressively (pricing in higher inflation and doing the exact opposite of FED monetary policy)
• Highest concentration in Top 10 Stocks (similar to what Geof Smith said yesterday)
• Concerns of overvaluation
• US outperformance vs the world (nearly 3 standard deviations)
• Higher inflation trend (US going the wrong direction)

There’s definitely plenty of uncertainty about the incoming President, as he is back to his usual quixotic behavior on the international stage.

Policies like adding Greenland to the U.S. for national defense might make sense, but as is to be expected with Trump, he’s certainly going about it in an… unorthodox way…

Still, the initial excitement in the aftermath of his election proves there might be some positivity in the market for his administration if he can zero in on the most important focuses that people care about. 
 

And Graham Lindman chimed in that that is pretty typical for a new president, sharing this chart:
 
 

I’ve always said that the markets loathe uncertainty, and there’s plenty of uncertainty to go around right now. So it might not be more complicated than that.

In any case, there’s plenty of opportunity out there still if you know where to look.

In fact, today at 1pm, Nate Tucci is sharing one great way to invest in stocks that JUMP unexpectedly in either direction → check it out here

Best of luck in the markets today!

To your prosperity,

Stephen Ground
Editor-in-Chief, ProsperityPub