Prominent Market Strategist Sees The Strong Possibility of a Return of the
1930's, The Shepherd Investment Strategist Announces
Business Editors
SPOKANE, Wash.--(BUSINESS WIRE)--March 13, 2001--A return to the
depression era of the 1930's is a distinct possibility according to
James A. Shepherd, who sees the US stock market in a no-win situation.
Shepherd, a prominent market strategist and founder of The
Shepherd Investment Strategist (a service of JAS MTS Inc.,
jasmts.com ) created a Model in the 1970's that has a 100%
accuracy record for predicting major changes in the US equity markets
and the economy.
It has issued 11 accurate signals since he started to use it to
advise clients. The Model predicted the 1987 crash 41 days prior to it
happening making Shepherd and many of his clients millionaires.
America has been using every trick in the books for the last 18
years to avoid a downturn in the economy, but we're running out of
tricks and we've run out of time. So how about Wall Street's current
mantras to lower the interest rates again and reduce the tax rates to
stimulate a slowing economy?
According to Shepherd "both are possibilities, but as a solution
neither is a certainty". As for reducing taxes, this is the least
likely of the two to happen!
Shepherd says the budget surplus reflected strong capital gains
taxes that have now turned into massive losses; high tax revenue from
a strong business climate is now declining due to a slowing economy;
and an artificial wealth effect that created a strong stimulus to
consumer confidence is now collapsing.
Unlike the Fed that looks at the past while trying to manage the
future, Shepherd has the reputation for being many months ahead in his
predictions. He says that interest rates present two possible
outcomes, neither of which is pretty for the stock market.
Lowering interest rates would have to be done in the face of
inflationary pressures as oil prices are generating higher costs for
most goods and services throughout the economy. One of the
consequences of importing this now very expensive commodity is a trade
deficit that is now at historic highs.
That, when combined with high personal and corporate debt, will
prevent recovery as we continue to live beyond our means. If interest
rates are lowered and inflation in real assets is not curtailed the
stock market will collapse just as it did in the 1970's.
But Wall Street is again pinning its hopes for saving the markets
on more and more rate cuts when it is obvious that high interest rates
are not the problem. A rate cut will probably only forestall the
inevitable for a few days or weeks but in the end a collapsing stock
market will lead into massive liquidation, forced selling of holdings,
debt repudiation, massive unemployment and generally hard times.
Since the Model issued its Sell signal in late October of 1999,
Shepherd and his subscribers have been safely invested in long term
government bonds that have now appreciated by over 23%. But increasing
inflationary pressures could have a profound effect on these bonds and
could demand a change in investment strategy in the near future.
jasmts.com
--30--CF/ph*
CONTACT: The Shepherd Investment Strategist
(A service of JAS MTS Inc.)
Stu Harper, 509/777-6500
marketing@jasmts.com
KEYWORD: WASHINGTON
INDUSTRY KEYWORD: BANKING
Today's News On The Net - Business Wire's full file on the Internet
with Hyperlinks to your home page.
URL: businesswire.com |
