Market prediction based on macroeconomic indicators - page 15
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Vladimir, do a forward to evaluate the theory. Without the forward it's all nothing.
Read the beginning of the thread. All models are based on the forward test. The economic indicators included in each model are chosen based on their predictive ability on the forward test.
If the Fed raises rates this year, it would be a mistake according to my model. It will probably cause an economic slowdown in the USA, which is undesirable against the background of a global recession (Europe, Asia and South America are still in recession). Here in the USA there is no particular economic acceleration. There is still a lot of unemployment and large companies have started to lay off a lot of workers. Even Apple has faltered due to weak Chinese demand. America needs the Chinese market and the Chinese economy is in decline.
Read the beginning of the thread. All models are based on the forward test. The economic indicators included in each model are chosen based on their predictive ability on the forward test.
If the Fed raises rates this year, it would be a mistake according to my model. It will probably cause an economic slowdown in the USA, which is undesirable against the background of a global recession (Europe, Asia and South America are still in recession). Here in the USA there is no particular economic acceleration. There is still a lot of unemployment and large companies have started to lay off a lot of workers. Even Apple has faltered due to weak Chinese demand. America needs the Chinese market and the Chinese economy is in decline.
The US needs the Chinese market??? Interesting. How much does the US export to China? I know that the USA is China's main export market, but I was not aware that China is a very important export market for the USA. And how much does the US export to China?
Are there a lot of unemployed people in the US? That's funny.
Right now the US unemployment rate is 5.3%. By comparison the Eurozone has 11.1%, Australia 6.3%, Canada 6.8%, UK 5.6%.
Does the US need the Chinese market??? I wonder. How much does the USA export to China? Well, I know that the USA is China's main market, but I did not know that China is a very important export market for the USA. And how much does the US export to China?
Are there a lot of unemployed people in the US? That's funny.
Right now the US unemployment rate is 5.3%. By comparison the Eurozone has 11.1%, Australia 6.3%, Canada 6.8%, UK 5.6%.
When unemployment drops below 4%, we'll talk about small unemployment.
The US needs the Chinese market. The Chinese need cars, smartphones, baby food, McDonald's ... About 10-15 years ago, many US companies in pursuit of growth discovered the huge Chinese market and started making products for that market. The Chinese economy grew >10% a year and with it the purchasing power of the population. Now China is in decline and these American companies are suffering. American companies with a small share of products for China are not yet suffering.
The Fed has long talked about the possibility of raising rates, but so far it has been just talk. It seems to me that by threatening to raise rates they are achieving many goals without raising rates:
When unemployment drops below 4%, we will talk about small unemployment.
The US needs the Chinese market. The Chinese need cars, smartphones, baby food, McDonald's .... About 10-15 years ago, many US companies in pursuit of growth discovered the huge Chinese market and started making products for that market. The Chinese economy grew >10% a year and with it the purchasing power of the population. Now China is in decline and these American companies are suffering. American companies with a small share of products for China are not yet suffering.
The Fed has long talked about the possibility of raising rates, but so far it has been just talk. It seems to me that by threatening to raise rates they are achieving many goals without raising rates:
) The China thing is hilarious. So you think hamburgers are exported from the US to China? US baby food is not available to the Chinese, and all US smartphones are made in China, not in the US. In short, that's where you're wrong.
1. The Fed has been saying all this year that rate hikes will start smoothly in the autumn.
2. Fed rates and the price of gold - something is wrong. The dollar exchange rate is directly proportional to rates. If rates go up, the dollar goes up. If the dollar goes up, the price of gold, denominated in US dollars, must go down.
It is much simpler than that - look at your picture of the SP500 - it is a bubble inflated by low interest rates. Something needs to be done about it - like any stock market bubble it will burst with a big bang.
Raising rates is the only way forward
Regarding predicting the SP500 - it can be accurately predicted if you have quantitative data on the QE programme
How to make money and reduce debt. I will give you my opinion:
you put a lot of money into the market and bonds at a low rate, then raise the rate and buy up the cheaper bonds and issue new bonds with a higher rate but lower volume.
If I'm not confused, they won't need to redeem the cheap bonds because they bought them back and they will cost the Fed less than they threw them into the market.
New predictions:
S&P500:
GDP:
No change in the trend so far. The economy will grow at a slow pace. There is no inflation. Prices are rising moderately, wages are rising slowly. No reason to raise interest rates. My model predicts that the Fed will not change interest rates this year. But since interest rates are decided by people who make mistakes, mechanical predictions of those rates cannot be trusted.
Objection ;)
Changes in the trend are very much in evidence.
My guess is that not only will the SP500 index stop rising, but on the contrary, it should move down soon.