I'm not sure that anyone reads this blog anymore. I don't blame them, I haven't updated it in over 2 years. But I felt like I needed to issue this warning for anyone who might still be out there. But before I do, I need to remind everyone that I'm not an expert in finance, the stock market or in building wealth. Historically I have done a poor job with my own money. But I have learned a few things along the way, and my sentiment now is to be cautious. I don't trust the stock market, or the Fed with the way they keep suppressing interest rates. Just be safe...
I'm making a prediction that the Dow Jones Industrial Average (DJI) will never get above 18.7k (at least not before 2020). It reached a high of $18,622 on July 20th 2016 and I believe that was the peak. I think there will be a big stock market crash before the presidential elections this November and I think the peak has already happened. We might rise up to that level again ($18,622) before the drop, but I'm comfortable saying that we will never surpass the 18.7k watermark.
I don't know when exactly the market will drop, but I'm guessing sometime in the next 3 months. My prediction is that the stock market in general (but specifically the DJI) will lose more than 45% from whenever it turns. I'm actually afraid that it will lose much more than that, but again I think we are in for a drop similar to what happened in 2008. It took 17 months to drop from a high of $14,198 in October of 2007 to a low of $6,470 in March of 2009. That's a loss of almost 55%.
The worst of it was when the market lost 18.1% in the first 4 months after October (from $14,198 to $11,635). That should have been the warning, but I like most Americans thought the worst was over. I stuck it out and ended up loosing about 40%. This time, I'm expecting a 10-15% drop before the elections, and the rest to slowly bleed out over 2017. I have pulled as much money as I can out the stock market and placed it in money markets to wait it out. God bless and be safe!