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Strategies & Market Trends : John Pitera's Market Laboratory
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To: John Pitera who wrote (17513)1/3/2016 10:03:24 PM
From: robert b furman4 Recommendations

Recommended By
benwood
Hawkmoon
John Pitera
sixty2nds

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Hi John,

agreed.

For years globalization was primarily a "bust the unions tool" here in the USA.

As the Chinese government embarked on an overbuild into the future export manufacturing policy - all global manufacturers raced to build new modern plants for export and to satisfy the growing demand within China's borders.

What got lost in the ME TOO panic to have a presence in China, was the concept of excess capacity in a world where developed countries already had too much capacity.

This doubling up of excess capacity has insured slow recoveries going into the long term future.

ZIRP on top of excess capacity has further exacerbated (slowed) the long term recovery.

Low rates have paid down debt faster, but I don't see a quick expansion coming from a growing demand for credit.

I felt that way at the beginning of the last recovery from recession and we all proved that we have short memories as demand for credit got out of hand especially in the biggest debt sector real estate.

This time aging boomers (like me) will make credit demand revival even slower and more prolonged.

Low rates are baked into the cake for a prolonged time period.

Makes me think any dip in equities is a gift to buy high dividend yielding stocks that demonstrated stability in the 2008 and 2011 equity sell offs.

I'm still pursuing puts to buy high yielders at below market rates.

Trying to stagger less quantities in each quarterly expiration with the hope of snagging a dip which has not lasted very long over this bull of the last several years.

This time period mirrors the low interest rate periods of the early 50's - slow steady growth and be conservative with no debt and saved cash for dips.

Its a slow time of sideways with some noise / news fabricated volatility.

Bob
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