Macro market analysis: SPX, NKY, GC (The FOMC, ECN and BOJ Game)

19. März 2015

S&P 500: In 2014/2015 we have experienced a very nice bull market as the S&Ps finished in 2014 returning a nice 13.69%, overall the bull market has been driven by the feds decision to keep interest rates low as investors piled in. recently the FOMC held a press realised where Janet Yellen (Chair of the Board of Governors of the Federal Reserve System) stated that the Fed had no intentions of raising interest rates until there where great increases in the employment numbers and a target inflation rate of 2%. Personally i think that we should see 2015 as a predominantly bullish year until Fed starts raising Interest rates, after the Fed has done that investors should watch out for some choppy behaviour and possibly a reversal into a bull market. I think that when the Fed raises interest rates a even deeper problem will be put to light that shows how europe's extremely bad fundamentals where shadowing the United states bad Fundamentals, as it stands now the Fed is in so much debt that for each 1$ they have they owe 70 in liabilities giving them a 1:70 ratio, Either way the FOMC has done a great job in masking these fundamentals so its a good bet that wed see a bull market in 2015.

NIKKIE 225 and GOLD ; Japans NIkkie 225 is much like the S&Ps except it has very nice fundamentals that are not masked by the BOJ. Investors have seen Gold be crushed in 2014 as they piled into the dollar and the S&P but as we see interest rates rise Golds value will reverse a little bit as investors start to pile back into gold, but if the S&Ps show only choppy behaviour instead of a Bearish market we could see the move by gold only being a fakeout.