Authored by Axel Merk via MerkInvestments.com,
With the stock market and Bitcoin reaching all-time highs, what can possibly go wrong? In offering my thoughts on 2018, I see my role in reminding investors to stress test their portfolios. Is your portfolio built of straw, sticks or brick?
First, let me allege many investors have portfolios built of straw and sticks rather than brick. How do I know this? Here’s a brief check:
It is undisputed that the last 2 quarters have demonstrated an impressive jump in corporate earnings growth, if mostly due to a beneficial base effect from plunging 2016 earnings which pushed them below levels reached in 2014. And naturally, this rebound has been more than priced into a market which has seen substantial multiple expansion since the Trump election to boot. But what is much more important for the market is what corporate earnings look like in the future, and it is here that Bank of America has just raised a very troubling red flag.
Once again weakness in the US carried through to Asia with stocks unable to hold any National-Team-inspired gains, but it was the contagion to commodities that was most notable (as a hike in exchange fees snuffed out a lot of speculative fervor)
ASIA
In the last 36 hours, Bitcoin has blasted through $12,000, $13,000, $14,000, and now $15,000 levels in an unprecedented 28% surge...
For those keeping track, this is how long it has taken the cryptocurrency to cross the key psychological levels:
CME Bitcoin Real-Time Index ($BRTI)
It's no secret that Bitcoin is amidst its biggest net dollar gaining session ever. Just when it seemed like Bitcoin price action couldn't get any crazier.... Flirting with a potential $2,000+ daily gain (at publishing), Bitcoin just pushed above $14k on the $BRTI. For those unfamiliar with the $BRTI, you'll hear about it a lot more after December 18th, when the CME Bitcoin Real-Time Index-based Futures go live.