Everyone is asking when the market will crash.
They’re pointing to overvaluation… interest rates… the bull running way too long… P/E ratios… unemployment… wages… Europe and International melting down… etc., etc. *
Long-time readers know that I care most about one single, solitary metric: The price of oil.
When oil spikes — like it did in 2008 — it affects the price of everything… and I mean absolutely, positively every item & service in the global economy.
That, of course, affects consumer purchases, which account for about 70% of all purchases and are truly the engine of the aforementioned global economy.
That, of course, affects corporate earnings, which affect stock price.
So, while everyone comes up with ever-increasing and complex ways to predict the market, I just keep my eye on oil… as I do every single day.
While the price of oil is subject to change at a moment’s notice… it’s been behaving for a while now. That’s my signal that it’s safe to stay in the water.
* P.S. They’re also talking about global military actions and terrorism… which absolutely do have the ability to derail the market in the short run… those are — depending on whether you are short or not — unfortunately or fortunately constant wildcards in this connected, modern world we live in.