Part 9/12:
When considering all these factors—resuming quantitative easing, high stock valuations, large fiscal deficits, persistent inflation, and a more dovish Fed under new leadership—the environment strongly suggests a looming meltup scenario. This "perfect storm" of policies and market conditions could propel markets to unsustainable heights before the inevitable correction.
Practical Implications for Investors
Understanding these macroeconomic shifts is vital for individual investors. Here are some actionable tips:
- Follow Liquidity, Not Just Headlines
Market movements will increasingly be driven by liquidity levels. Recognize signs of easing and tightening, rather than relying solely on economic news or official statements.
- Avoid Chasing the Top