Tag Archives: monetary policy

Epocalypse Now: The Economic Apocalypse is Here

Submitted by David Haggith
The Great Recession

When I predicted the economic apocalypse would begin for the US this month, I said the stock market would rise euphorically after the Fed raised its interest target. Rise it did. Steeply, too. I also said it would fall shortly after. Fall it did. Quickly, too. Now I’m saying the Epocalypse is here.

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From an epocalypse of another time By Dorothea Lange, Farm Security Administration / Office of War Information / Office of Emergency Management / Resettlement Administration [Public domain], via Wikimedia Commons
Just as I stated that “the rate at which the market goes up now is a measurement of pure euphoria,” by the same token, how quickly that euphoria falls off indicates just how far down the downside is. If you have ever floated in the ocean and felt yourself unexpectedly drop way down with the water, you know that means a huge wave is coming up right behind you.

“Particularly watch out,” I warned, “if the euphoria cools quickly because, after more than a year of concern over what would happen when stimulus ended, there is a lot of relief the bulls would like to celebrate. If the euphoria cools quickly, it’s likely to mean things are ready to go down hard and fast.”

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