Bear! Message Board - Msg: 34631071

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Strategies & Market Trends : Bear!

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From: Harshu Vyas	4/10/2024 9:37:18 AM
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Not a bad time to go bearish with inflation persistently running hot. But what we really need to see is inflation/interest rates affecting corporations for a correction to take place. With certain companies, it has. For tech companies, who generally operate with minimal levels of debt, capital raises are too easy in this market. How can you short them? You'd be a fool to try. Perhaps more obviously desperate capital raises will signal a top (i,e Wall St will be their own undoing. I wonder if they're positioned bearishly? They'd never admit it, of course.). But if companies like Nvidia continue to blow earnings out of the water... the hype will just breed. Hard to pinpoint exactly when this all boils over. I still think that a "shock" rate hike could be the catalyst. Or a cut, followed by a resurgence in inflation. Very hard for the Fed to navigate this market - but I think Powell will choose what's better for the economy and not markets. My take - stay away from leverage because both inflation/rate hikes will result in pain for equityholders, UNLESS the company can get away without refinancing and can buy back debt aggressively. Not many can.

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