Sorry, Investors, You Can’t Buy the Dip Anymore
There are reasons to be tempted, but buyers can’t count on the Fed to help them out
There are two reasons you might be tempted to buy the dip.
The second is that stocks had already fallen a long way (a very, very long way in the case of the stocks ARK likes), which means investors were already prepared for bad news.
James Mackintosh WSJ 20 March 2022
https://www.wsj.com/articles/sorry-investors-you-cant-buy-the-dip-anymore-11647738573
Plenty of interesting investments no longer require you to swallow an obviously excessive valuation.
But all of these sectors remain expensive compared to the norm for the post-crisis decade.
It’s now a commonplace that the risks of stagflation (economic stagnation plus inflation) have risen since the invasion. It would be absurd to deny this.
But there is a difference between “stagnation” as in slow growth, which allows corporate profits to grow and means that stocks offer some kind of a hedge against inflation, and stagnation as in outright recession. The latter scenario is horrendous, but rarer.
John Authers Bloomberg 21 mars 2022
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