A second half 2018 market forecast is now appropriate as time slips away with already half of the year confined to history.
First, Darren Winters starts with the easy part of his second half 2018 market forecast
The wheels of the fourth-revolution will most likely spin faster as stagflation, the problem of waning consumption and rising costs will force businesses to employ cost-saving technologies to safeguard their profit margin in a toughening economic environment.
Darren Winters second half 2018 market forecast
Companies which are part of this Fourth Industrial Revolution, which is a fusion of technologies that merge the physical, digital, and biological spheres will most likely outperform the broad indexes. These are the companies that are spearheading emerging technology breakthroughs in the following fields of robotics, artificial intelligence, the blockchain, nanotechnology, quantum computing, biotechnology. For example, in the field of robotics meet Hadrian, the bricklaying robot and the Big Mac ATM machines.
Human labor need not apply, not even at the minimum wage. The fourth-revolution doom loop is already a genie out of the bottle, it is likely to diminish the demand for human labor in production and that is a story within a story. During the last industrial revolution horses where replaced by the mechanical muscle, the combustion engine, mass transport. Today, horses are no longer employed in production, they are only for recreation and ceremonies. Moreover, the horse population has been greatly reduced. So will humans be any different to horses in the fourth-revolution of the mechanical brain?
Maybe this is losing the plot of the second half 2018 market forecast, after all the capitalist vision (thinking) tends to be short-sighted (immediate reward) they only want to see profits here and now.
Darren Winters second half 2018 market forecast is for a sell-off (cash-out) of emerging markets to continue in a backdrop of tightening USD liquidity. The forecast Darren made back in January, that an emerging market rout based on the Fed’s (world central bank by default) tapering-fears has played out. Indeed, Argentina, Brazil, and India have all been in the news lately whether it be collapsing currencies or nonperforming loans.
But Darren’s second half 2018 market forecast would be meaningless if it didn’t zero in on what the Fed is likely to do for the remaining 2018. The EM rout is based on tapering-fears. But here is the takeaway, then the Fed has yet to unwind its massive balance sheet, bearing in mind that reduction in Fed assets from 4.5M to 4.32M can hardly be described as “normalization.”
So this is where Darren Winters second half 2018 market forecast gets interesting and dicey. Stocks are at a crossroad. Moreover, the Fed has its finger on the trigger and can cause a stock market crash at will.
There are two schools of thought where we go next
The Fed will torpedo Trump’s chances of being elected in the November 6 midterm. The Fed’s great unwind will cause a stock market crash and Trump will be their useful idiot – the “fall guy”. Alternatively, Trump is the Fed’s (secret shareholders’) dog in the fight. Sure, Trumponomics is incompatible with global capitalism but the big picture is about dollar hegemony fight back. Trump’s neoconservative, Zionist administration to dominate the Middle East upholds the petrodollar. Moreover, the re-industrializing of American manufacturing will give the USD backbone (soft power of the Empire).
Darren Winters second half 2018 market forecast is the latter, a stock rally after Midterms, but it is a toss of a coin.