Suncor Energy Inc. T.SU

So Where could the Market Go?

[Experienced]

I received a text yesterday from a friend who asked my opinion on where I thought the market could go. &nbsp;My response was that I could see 20000 on the DJIA and perhaps if it got down down into the hundred year channel - 15000.<br /> <br /> So where do I get such numbers??<br /> <br /> There is a long term relationship between interest rates and the market P/E ratio. &nbsp;It is essentially reverse relationship meaning the higher the interest rate the lower the market P/E ratio.<br /> <br /> I don&#39;t see inflation over the next six months or so going below 6%, especially since OPEC is cutting production in an effort to increase oil prices. &nbsp;As Obscure says, oil is the world&#39;s currency.<br /> <br /> Hisrtorically, when the Fed doesn&#39;t act soon enough to raise interest rates, the Fed rate goes above the inflation rate for a while until things cool down through a recession. &nbsp;So we take the 6% inflation number, we would get a market P/E ratio of in and around13 compared to the current number of 18.5.  Such a relationship would generate a DOW of 20000.

[newcoin]

You have to stay in the market so you don't miss the best market days. I will be owning the market constantly and buying on dips. I think this is a lifelong opportunity that we're being presented with.

[Experienced]

Just curious If you are in the market all the time then what money do you have to buy the dips?  Seems to me that you must have some money on the sidelines like I do.  Either that or you are like a Central Bank and can print money out of thin air...lol. The other thing is - what do you mean by "the market".  Do you mean just stocks or stocks and bonds? The other

[Spanito]

Hi Experienced,   To add to this,   I say that The Storm is Already Here.   Most don't even know it, or are in denial.  I moved all my money out of the stock market now.  I started exiting about 8 weeks ago.  I held onto some of my worst picks for the longest to see if they would recover, some just taking litte bounce as a tease.     

[Experienced]

Good post Spanito and good advice!! In terms of the storm coming, I would think of it more like what we are experiencing is the outer bands of the huricane.  The main storm has yet to come.  In terms of where oil prices go - who knows.  One thing I find interesting is that OPEC is reducing supply and one has to think that the consensus there that is a recession is coming and they

[newcoin]

Yes, I have money on the sidelines for some dry powder. I also have diversified investments and will sell winners to buy losers, averaging down. My market is just stocks. I do own GICs in some retirement accounts. The market may go low enough that we won't see that low again. When the bottom is in, and stocks start to rise, all my investments will be green. The very low prices paid will keep

[newcoin]

CNBC: 10 BEST DAYS IN THE MARKET FROM 2002 THROUGH 2022* RANK Date Return 1 Oct. 13, 2008 11.6% 2 Oct. 28, 2008 10.8% 3

[Experienced]

Thanks for the clarification - much appreciated. From earlier posts, I had the impression that your strategy was much different from mine.  Seems that that impression was inaccurate.

[cautiousguy]

So you must be loading up on your favourite stock run by your favourite CEO because that stock is down 96% and trading at .045 cents.  Great strategy/must be a great bargain.   Keep me posted.