AND NOW THE BIOTECHS!

“AND NOW THE BIOTECHS”

By Gary Kaltbaum- September 22,2015
@GaryKaltbaum
garyk.com
Fox News Business Contributor

On our appearance on Neil Cavuto’s “Coast to Coast” show on Fox Business yesterday(if you don’t get it, demand it), Neil asked about Goldman saying 2100 was still their target for the year which is only about 7 percent higher. Anything is possible especially when you believe the next Fed move is QE4 but our simple answer was no. Bear markets will not allow it. The problem is that most if not all are still working off the principle that we are still in a bull market for stocks when we are now in a bear market. Simply put, the rules now change. We then went on to say that financials were in a bear which directly correlates with the downside and just yesterday, the Biotechs imploded. As we have told you, the Biotechs have been the leading group in the market for a very long time.Too long! Too long to the point where over 200 names with NO SALES have been able to go public…which we have told you is a disaster in the waiting. When the leading group in the market goes bye bye, it is just another data point that markets are in trouble. Most are blaming the NY Times and Hillary for the drop in the Biotechs. There is always a catalyst. But one needs to know, in bull markets, you typically do not get meltdowns like we saw yesterday. So be careful. Expect analysts to fall all over themselves defending the group as the group is very over-owned by their management arms.

This continues to trace out a classic bear market. In bear markets, surprises happen to the downside. In bear markets, good news is bad news and bad news is worse news. And in bear markets, it doesl not matter what the fed says or does. (Well, maybe $100 trillion of printed money could do the trick!)

Janet Yellen lied when she said they were not paying much attention to markets. We have news for you. That’s all they are paying attention to. Why do you think they are now talking rate hikes? It’s because they saw their “NO RATE HIKE” last week didn’t work on the market so they decide to do something different. Not going to help either way!

We have some very strong advice for the Fed during this bear phase. Stay away. Stay very far away. All you will do is exacerbate things as markets have now fallen out of love with you.

Looks like we continue to be headed for a retest of the scam lows. Them lows better hold.