Taking his place among some of the stock market’s most pessimistic doomsayers, Graham Summers, chief market strategist at Phoenix Capital Research, has been extremely bearish on equities for a long time. Some of his alarmist headlines include “Stocks could lose 90% over the next two years” and “The Fed has set us up for a massive 50% collapse,” to name just a couple.
Well, he ramped up the urgency again Monday with a timely Halloween post laying out a fresh batch of warning signs — or “tells,” as he describes them.
“This has the makings of a financial crisis,” Summers wrote. “The whole mess is starting to feel a LOT like 2008 again.”
Here are those “tells,” and the charts to go with them:
1. Bond yields are spiking around the world. “With bond yields rising, earnings yields will follow,” Summers explained. “The only way for earnings yields to rise is for stock prices to FALL.”
2. Only a few stocks are holding the market up. “The number of individual companies above their 50-day moving averages has been in a virtual free fall since February,” he said. “Literally a handful of companies remain strong. Everything else is breaking down.”