October Crash
The Well-Timed Strategy for Week Ending September 18, 2009
by Peter Navarro, Ph.D.
September 16, 2009

Stock market trend: Up.

Market Pulse

We survived the brief market pullback so thus far September looks a bit safer than in previous years. The big question hanging over this market is whether the investment-led recovery will be given legs by a revival of consumption. The jury remains out on this as consumers are clearly saving more and undergoing an interesting transformation from spendthrift bubblemeisters to far more thrifty families. The danger is that we may catch Japan’s “paradox of thrift” disease: Japanese citizens have been so paranoid about the economy that they never spend enough to restore robust growth to the Land of the Setting Economic Sun.

For a more detailed analysis of whether consumers will fail in the follow-through and lead us into an October stock market crash, I strongly urge you to view my latest video at TheStreet.com. I do these videos in lieu of the lengthy newsletter at least partly because it’s a lot easier to add chart content to the video. I guarantee that if you view this one, you will learn a lot about how to forecast the stock market trend. Click here to view October Crash at TheStreet.com. Do let me know what you think.

© 2009 Peter Navarro

“Any trader or investor who ignores the power of macroeconomics over the world’s financial markets will, sooner or later, lose more than they should and if they are trading on margin, perhaps more than they have.”-- If It’s Raining in Brazil, Buy Starbucks

Peter Navarro is a business professor at the University of California and the author of the best-selling investment book If It's Raining in Brazil, Buy Starbucks and The Well-Timed Strategy. His latest book is The Coming China Wars: Where They Will Be Fought, How They Can Be Won.

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