State of the stock market May 2023

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 This video has me convinced that from now (May 2023) until a recession the stock market won't be doing well, despite a nice run recently.

Mainly it boils down to the stock market historically tracking the M2 money supply, which has been going down. You can look at the graph going down. It will keep going down as interest rates are kept high and the Fed does quantitative tightening further reducing the money supply. It will only be when a recession hits and the Fed drops interest rates, pumps fresh money into the system, that the stocks will resume the bull run. When this happens, the market should be real amazing.

What would I bet on now? I would do treasuries like TMF (or TLT) which go up dramatically when recession hits. The Fed believes that it will take an entire year before interest rates are cut, but recession is more likely to hit much sooner, and therefore interest rates cut much sooner.




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