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b'Really a Head Fake
\\nAs I suspected and as I stated in my last podcast at the end of the first quarter, I speculated that the rally that closed out the quarter was really a head fake. When the quarter started, I said you would see a resumption of the downtrend of the evolving bear market, which I believe we are already in.
\\nBear Market
\\nEven though technically we\'re not there yet because we\'re not down 20%, but you can\'t get to 20% without first hitting 10%. Although not officially acknowledged, we are in a bear market. Just as often a recession is not acknowledged until after 2 quarters of negative GDP growth, but clearly you\'re in the recession for a long time before it\'s officially acknowledged.\\xa0 That doesn\'t mean you weren\'t in a recession before they admitted it, albeit not officially.\\xa0 Similarly, they haven\'t proclaimed this bear market.
\\nThe Fed Could Change the Game
\\nThere\'s one caveat:\\xa0 if the Federal Reserve comes in and changes the game by taking away the rate hikes or launching QE4, then we may never make it to a bear market.\\xa0 But if the Fed continues on its current path and maintains the current pretense, then we are in a bear market and it\'s only a question of time before it is officially acknowledged.
\\nNo Real News to Blame for Sell Off
\\nAs I expected, traders came back from the Passover/Easter break and started to sell.\\xa0 They came in almost out of the bell; no real news to blame the selloff on.\\xa0 Now they tried to blame it on Trump and the tariffs, and while I agree that tariffs are a problem, there was nothing new over the weekend.\\xa0 Yes, China came out and announced a couple of billion dollars worth of tariffs on some agricultural products, etc, but this was not unanticipated.\\xa0\\xa0Anybody who did not think this was coming - c\'mon - China could have could have done a lot worse than this.
\\nAny News is an Excuse to Sell
\\nIn fact, the market could have just as easily rallied on the fact that this is such a small response and they could have said, "Oh, this is nothing, it could have been a lot worse!" So the markets could have bought, if they were in a buying mood. But this is a bear market, and so all news is bad news.\\xa0 So, whatever the news is, that\'s an excuse to sell.
\\nChinese Tariffs on Agricultural Products
\\nBut what it does, is it lulls investors into a false sense of security: "Well, the market\'s not going down for any reason", "It\'s not because we\'re in a bear market, it\'s because of the reaction to the news that the Chinese are going to have tariffs on agricultural products.
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