Hi all. Been a long time lurker. Wanted to know what everyone's opinion was on the spike in oil prices. Usually a spike like this leads to a recession. Do you think something similar will happen again? Combined with this, we have a flattening yield curve which may inverse within this year. Finally, we also have a FED that is trying to control inflation with higher rates that may slow down the economy. If this economic growth fades away, and gas prices continue to increase, then this will be stagflation at the end of the day. Of course, none of this matters if the FED opens up their balance sheet again and lowers interest rates even further (maybe they will even go negative?) But my point being, I have sold all my long term holdings already but am considering shorting the market with my extra funds (approx. $200) by buying VXX for now.
Yes recession is coming, but not tomorrow. Who can say when? Many stocks are oversold right now. The bounce will be intense. If you weren't short before, it is quite risky to try to short now....but possible.
Why do you say that many stocks are oversold? I would argue that many stocks such as meme stocks such as GME and TSLA are still quite high. QQQ has experienced a significant sale but tech is still quite overvalued (especially when you factor in the fact that PE ratios are still 20 - 25 only). I may consider just holding off and waiting for a buying opportunity. But with inflation, rising oil prices and Ukraine-Russia conflict, I think things will get worse before they get better.
You are not the only one that thinks things are bad right now. In fact we are near an extreme with people thinking things are bad. Which is why it is risky to short right now. Like you said, there are select opportunities you can find though.
