Solar Event Eclipses Taylor Swift Boost to GDP

In a recent Bankrate survey conducted in January, nearly half of Americans expressed doubt in their ability to muster $1,000 in the face of an emergency. However, when it comes to Swifties attending football games to catch a glimpse of their pop icon or flying across the country to witness a black dot – aka Solar Eclipse – for a few minutes with $2 paper sunglasses, billions can be spent. It is a spectacle to behold as the adoration for solar phenomena appears to overshadow the months-long Taylor Swift sightings.

However, these fleeting economic upticks pale in comparison to the extravagant deficit spending orchestrated by the current administration, reminiscent of a bygone era of Covid-induced fiscal turmoil. The confluence of prodigal government stimulus and unabashed consumerism, coupled with the enthusiastic spending of the 76.4 million Baby Boomers eager to enjoy their retirement funds, sets the stage for sustained economic expansion.

While we refrain from attributing any enigmatic investment significance to the occurrence of a New Moon during a Solar Eclipse, it is worth noting that the previous eclipse coincided with the onset of a new Bull market 19 months later, mirroring the current bullish momentum. Could this alignment foreshadow a prosperous future akin to the early stages of the nearly six-year Bull market that commenced in 2016? The notion of a six-year upward trajectory from the October 2022 nadir may seem fanciful, yet amidst sound credit fundamentals and surplus liquidity, anticipating another year of economic growth culminating in a 2026 cyclical peak appears judicious.

And let us not overlook the profligate spending habits of our government. Each political faction seems intent on reliving the exuberance of yesteryear, leveraging their inaugural year in power during purported crises to dispense imprudent levels of deficit spending, all in the name of economic sustenance until the next electoral cycle beckons.

Against the backdrop of a robust full-employment economy in 2023, fueled by the illusory promises of a meticulously managed world, our government persisted in inflating budget deficits by nearly $2 trillion through ongoing stimulus measures during more somber times. As 2024 unfolds, the trajectory of excessive spending and borrowing beyond our means appears even more pronounced, painting a concerning fiscal picture for the years ahead. How many inflationary trillions in fiat currrency will be created out of thin air when the economic cycle inevitably turns south next time?

Gloomy long term national debt risk can be tabled for now as our economy is increasingly the envy of the world in a burgeoning era of technological acceleration into an AI future that may send futuristic sci-fi movies to the rear view mirror.

Nvidia stands as a prominent indicator in the realm of AI and economics. Alongside other aspiring giants in the tech sphere, its trajectory exhibits a notable upward trend. However, in recent weeks, it has paused for respite, mirroring the broader trend seen across most stock indices. Despite the current trading range oscillating between 970, a substantial correction is yet to materialize. Nonetheless, prospective buyers eagerly await an opportunity to seize shares at prices in the $700’s range or lower.

The competitive landscape witnessed Intel and Google unveiling rival chips this week. While these developments are noteworthy, they currently occupy the periphery and are unlikely to impede Nvidia’s anticipated expansion and growth trajectory.

All the major stock indices continue in the trading range congestions we expected from mid February. Seasonal tailwinds begin to slow in mid to late April and continue to warrant long side bias with modest cash holdings.

With the context of an old adage cautioning against selling short in a quiet market, there have been only 10 previous occasions, prior to today, where the S&P 500 Index surged by more than 25% in 100 days. On each of these instances, the index recorded higher levels three months later. While history may not replicate itself precisely, it frequently echoes familiar patterns.

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