Forget What the Government Says…This Key Indicator Says the Economy Is In Big Trouble
The price of oil has fallen each of the last six days. It’s now down 19% since the second week of June. And it’s trading at its lowest level since April(as of 7-29-16 $42.38).
You see, new methods like “fracking” made it possible for companies to pump billions of barrels of oil that were once out of reach. U.S. oil production has nearly doubled since 2006. Last year, production hit its highest level since the 1970's. Output from other key oil producing countries also spiked.
Overall, the price of oil fell nearly 75% from its 2014 high. Then, earlier this year, oil started to rally. It surged 89% from February to June…only to crash again recently.
But, this time, oil is falling for a different reason. As you’re about to see, it's the latest sign that the global economy is headed for big trouble…
Caterpillar just put the global economy on watch
Because of the global scale of Caterpillar's operations and its involvement in long-term capital projects, the company's outlook is used as an informal bellwether of future economic conditions.
"World economic growth remains subdued and is not sufficient to drive improvement in most of the industries and markets we serve," the company said in its statement.
DYI Comments: Too soon to make a recession call. This economy has been "dancing on the head of a pin" between ultra slow growth and recession and has been growing(what little there is) since it's bottom in 2009. This economy is very long in the tooth, increasing the expectations for recession, nevertheless we are not there yet.
With an overvalued and over bullish stock and corporate bond market along with an economy that has been growing since 2009 now is not the time for wholesale commitments to stocks and bonds. There are bad times to invest and this is one of them.
Updated Monthly
AGGRESSIVE PORTFOLIO - ACTIVE ALLOCATION - 7/1/16
Keep your powder dry better values are ahead!
DYI
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