Morgan Stanley WARNS Of Coming Recession & Stock CRASH! - Sells All Junk Bonds!
In this video, I talk with author and economic analyst John Sneisen about the recent warning from Morgan Stanley that we'll likely see a correction in global stocks this year.
The bank recently sold off all of their junk bond holdings and the CIO Mike Wilson said this,
“While the tax cuts just enacted in the U.S. may lead to better growth in the short term, they may also bring forth the excesses we typically see before a recession — which is something credit markets figure out before equities." As a result “we recently took our remaining high yield positions to zero as we prepare for deterioration in lower-quality earnings in the U.S. led by lower operating margins.”
He went on to say,
"investors should prepare for at least one correction in global stocks this year."
Now this is happening as bubbles continue to gain pressure across the board and market manipulation meets its inevitable end.
While everything seems great, we're seeing an uneducated euphoria that we've seen far too many times before leading up to a crash.
People are flocking into decentralized assets like Bitcoin and other cryptocurrencies as well as gold and silver. This is a sign of a coming storm as individual demand moves closer towards freedom and further away from centralized manipulation.
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Ah, I miss the Junk Bond days of the late 80's and 90's. Quite pleased to see this post. Thank you @joshsigurdson. One must always be cognizant of the equity component of junk bonds and how it is one of many key indicators of future equity market moves/returns. It was a much more reliable leading indicator back in the day. However, with HFT, ETFs, etc., it has become somewhat less reliable, yet important.
If the stock market crashes, cryptos will go up!
A lot of people will lose there homes. Strange how some one has to suffer in order for someone to keep rewards.
Thanks for your post!
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Great interview as usual. Morgan Stanley is getting out while they can. You and John have great chemistry in your interviews!
Great opportunity for crytocurrencies to rise beyond the expected predictions.
If the market crashes, then what about crypto though? Won't silver and gold be the safest investment? After all, do we really know how crypto will end up?
Well if your in a pyramid that is closing quickly, gold can be difficult to get out with, quick. But if you have a hardware wallet, you can run.
But if everything crashes, then what good is a hardware wallet?
Yeah, I always hear this argument floating around. But if everything crashes, assuming it isn't because of the eventual coming of AI, then gold/silver/crypto/money will be the least of your problems. I'd recommend a couple guns, a guard dog, and food and water. No imaginary trade of value will matter too much if "everything" collapses. Oh, and drugs and alcohol, those would be winners.
Let's all build bomb shelters and start preppin' :) Thanks for commenting @luckynumber777
Food, commodities will be the only 'safe' investments when tshtf.
invest in canned food maybe? :)
LOL! okay, so this gif is hilarious.
Thanks for sharing :D
Anyone paying attention knows the crash is coming.. Buy SILVER!
Nothing wrong with a correction. We are now in a year long bull Market - its clearly time for a correction.
They sell their Bonds to hold crypto ..
People seem to think that cryptocurrencies are not subject to the same risks. They are.
Many of the largest currencies don't have any real underlying value and minimal purpose. The average newbie investor is buying coins because they're increasing in value, without understanding that the value doesn't exist. It's a ton of FOMO hype.
I foresee a major crash coming sometime. A lot of junk currencies are going to die out and we'll see a lot of consolidation of the market into the remaining cryptos that have actual real underlying products / services.
I think you're spot on @weaselhouse, I couldn't agree more.
The dream of a use-able currency right now for blockchain.. BTC just can't deliver.
It's definitely sowed the seeds, and I think new tech like Hashgraph will be able to deliver on this dream in the future.
In the meantime, 99% of these cryptocurrencies in my view are wildly overpriced, and will return to their intrinsic value soon enough.
I think, like any investment strategy, you want to utilize diversification and cryptocurrencies are another thing to diversify into. It is hard to predict which choice will be the right one when things go south, so be in many things, including cryptocurrencies.
Thanks as always for the good advice Josh!
Morgan Stanley sees what’s coming. Another reason cryptos are exploding, to get out of fiat. Gold and silver would see the same if they weren’t “managed”
I'm pretty convinced silver is "managed" like you say as well as gold.
I guess it all depends upon how bad you think it is gonna get. If the prediction of a financial crash is just a prelude to WW3, or some natural disaster, or a CME from the SUN (kill shot), then having digital money might be problematic if systems are down for a time. Gold and Silver are always difficult to travel with -- unless you put gold fillings in your mouth or something. Never will I do the implant in the arm or the forehead. I'm thinking Yoko's advice is the best: "You can't take nothing with you but your soul. Dig?"
On the topic of bonds...
My friend's parents just met with a financial advisor. They told him their risk tolerance was low, so he suggested a portfolio made up of 80% bonds. It saddens me that the wicked ones at the top have incentivized the pawns at the bottom to pass the buck to an unwitting middle class right before a 30 year bubble pops.
I think you don't understand the varying levels of bonds, they are selling off the high rate yield bonds , which as much riskier, the FA probably suggested low yield bonds
I understand there are different risk levels that come to bonds. But in this market, all bonds are risky. You've heard of the "everything bubble?" Well bonds is the biggest piece to that bubble. Bonds have been in this bubble for 30 years now. Plus Bonds are literally monetized debt by the federal government as a promise that they will pay you back. We are having a debt crisis right now in the United States and the amount of money that has been borrowed is an impossible amount to pay back. I mean why would any sane person purchase debt of a government that's been running deficit spending for decades?