Reiterate: Buy the dip
The market keeps falling even though the fundamentals of the US economy aren’t worsening. Right now, the major indexes are close to the lows made in August during the beginning of the sell-off.
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The recent selling bears a strong resemblance to prior selling in 2014 and in 2011.
In the short run, the S&P 500 could fall another 5% to 1820, but it from there it will probably make a vigorous rally and close the year positive or flat.
With stocks falling, the labor market soft, and potential problems in China, any rate hike in 2015 is off the table.
Large cap, high-IQ companies like Apple, Facebook, Microsoft, Amazon, and Netflix will keep posting strong earnings despite the media’s insistence that the economy is weak.
Data points like GDP and consumer spending keep rising:
The media says the consumer is maxed out, but apparently consumers didn’t get the memo and are spending as much as the ever have.