So what happened to the stock market in the early ‘Seventies episode, you might ask.
The market peaked right at the New Year of 1973. By analogy we might expect the same for 2012. From the previous post note the leading nature of the Michigan Sentiment series, which recently had its own pop to the upside. Expect some delusional holiday cheer out of Old Europe to keep the fake rally going, but after New Year’s Eve and the first few trading days of 2012, it might be time to say “risk off.”
N.B. This is research, not investment advice. You invest at your own risk, unlike the Wall Street banks, who also invest at your risk. Just wait until the Euro sovereign CDSs come home to roost, how the Wall Street bankers come to Uncle Bernie with their hands out (Uncle Sam doesn’t have the cojones to give them any more money, afraid of being tarred and feathered).