Rates will rise next year. Look at some undercut commodities to play, although even here isn't completely safe because inflation and a weak economy is a possibility depending on how things play out. A weaker dollar and a bigger national debt certainly doesn't help things.

Sadly I agree, Yellen will walk away thinking she has saved the world and is doing things for the little guy even though she has created the greatest wealth discrepancy than any other Federal Reserve chair for decades. In the end, she probably views things like a bureaucrat and views the fact that she could play monetary God and rain free liquidity on all her banking friends for years as a success. And indeed it was success for them. You are correct that they now need rates to rise slowly to unwind their interest rate derivatives over time, thus the minuscule rate increases. Drip, drip, death by a billion drops on the head.

Agreed, the dollar should grind weaker given the tax bill. There is a good reason why bitcoin has taken off at this time. It is yet another warning of the dangers of playing weak monetary policy cards to artificially stimulate the economy. Sadly cause and effect are delayed, so one may not correlate the eventual negative effects of potentially weaker government revenues with a downturn caused by inflation later.

Very interesting perspective. Indeed energy crisis cause disruptions and those may be slower and more lasting than the drop in usage caused by shortages. I think the issue at hand today is not peak oil issues but rather excess surpluses which have caused the price of oil to drop below the cost to invest in more production. This is slowly working its way through the system which the author is correct takes years.

Sadly the response has been to find cheaper ways to pump which only drags on the process and misallocates even more resources. The argument is why don't people just refuse to sell at a price that is more expensive to get more oil. The answer is more complex. Like all economic systems those dependent on oil to make a living wage can not go without income, especially since whole countries are dependent on the revenue. It is a enormous problem hurt by the fact even more oil is discovered as the pressure mounted for even cheaper methods of extraction to counter the drop in price.

The last piece of the pie is the massive reserves built by banking which was hoarding oil as a commodity asset as the economies stalled in the last downturn. The overhang has only grown since. In the meantime, the global economy has slowed dramatically and is now dependent on an even more volatile mixture, QE and artificially low rates. Sadly this causes even further wealth disparity and does little to nothing for added consumption. It actually raises housing prices and creates asset bubbles which is issues that create far worse problems sometime in the future.

That said, oil prices have seemed to be slowly recovering as the world comes to grip with the changes. However, there is a lag time and the world economy may still have some issues to get through before it can accept the new norm. Those flying high on oil income and wages will be a smaller and smaller crowd just like those making big bucks selling coal dropped to a very few. Only the big and diversified will survive well as the profit in oil will increasingly go towards processing and away from pumping.

The next issue will be what happens with potential bubbles caused by the central banks because many things like housing can not be supported by income, wages, or rents at these inflated prices when the economic cycle goes into reset. I am not too concerned with the stock market because much of it is backed by profits and some growth. What people should be worried about is that which has neither of these.

I think there are two problems with why there seems to be a lack of correlation between the two these days. 1. The way inflation is calculated purposefully and incorrectly under weighs inflation in housing costs and arguably other sectors. Housing costs and medical costs along with education costs are sucking up all the people's money leaving little room and smaller houses to buy and consume anything else keeping inflation and demand low much like Japan. 2. Dropping rates so low undermines growth and capitalism and rate increases back up have may have a larger drag the economy than regular, thus more strongly working against inflation. This encourages the status quo and is why it is so hard to escape zirpish rates and QE and normalize the economy.

Japan is the best example of the black hole of zirpish rates and QE. It is amazing that the US allowed the Federal Reserve to copy this failed experiment at all.

The crypto impact will be felt less in the stock market because it isn't a component in the market like the dot com bubble, however, the willingness to take risk will have a dampening effect. Given the slow growth of the market it will cause a bump. Strangely, bitcoin and crypto betting is somewhat due to both greed and fear.

A crash in it will have to be assessed as to why it crashes. If it crashes because growth, stability, and market forces get back into play versus QE and destroying capital value with artificially low rates then it could actually be good for the market. If, however, it crashes due to the fact that optimism is subdued and cash flow diminishes so much everyone needs US currency to cover expenses this will be caused by the market and crypto currencies will just be a giant glaring example of the fallout.

The market should be careful counting eggs before they hatch. That said, the stock market is doing just fine without much happening. I'm not sure if this deal falls apart how bad it will be for the market. The simple fact is, as things are today, a growing asset bubble is favored and encouraged. When this ends it will most likely end badly, that will be the time we need real reform. I don't see the tax proposal lessening the damage or likelihood of a cyclical downturn (it will happen eventually), but i do see it making the budget worse for dealing with it in the future.

I agree with the author that the economic picture isn't as rosy as implied, however, it has been this way for years now. Furthermore the lack of people to recognize the giggling of past numbers to push up current numbers is infuriating. It is also true that Federal Reserve policy has inflated asset prices without economic growth to match.

However, the Federal Reserve and the government's ability to do what's in their interest at the cost of future growth has no bounds and will persist until it can no longer. Calls for its immediate demise are weak. There are however cracks. The economy is being supported by weak dollar policies which aren't sustainable. Inflation continues in sectors of the market although it hasn't spilled into the retail space. It may if weak dollar policies are pushed too far.

The good news is the rest of the world is recovering and is more stable than last year. This will help the economy. Likewise, looking at the market, the fact is big corporations have been growing by eating smaller players and buying up their stock with debt. This is one reason why the market has gone up and is justified whereas it wouldn't be if the market hadn't actually been shrinking. There are a lot of factors going into the market and things aren't that cut and dry. That said, caution is key here, especially since the author is right and household incomes aren't keeping up.

I agree that it is best to be safe, however, fear not love of gambling is what's driving the market. The fear of what to get into if rates increase is what's forcing money out of housing and everything else that doesn't make a decent return and into cryptos and everything else that looks like it will make a decent return. This is especially true for foreign money that isn't that impressed with bonds given they are all sporting losses with the dollars' devaluation this year.

More stability and predictability will come into play as it gets integrated with the futures market. Bitcoin doesn't need kids paying for under $50 games to be relevant.