Key facts: The bear market for stocks could be prolonged, says Surz. Bitcoin could decouple and maintain its upward trend. Despite the slight recovery of the stock markets from last week's drop, bearish expectations continue to appear on the part of some analysts. Financial specialist Ronald Surz, who recommended investors to leave the stock markets a fortnight ago, insisted on this again. This week he published a report in which he argues that Stocks are no longer a safe place to investespecially for baby boomers because of their age. These people are those born between 1946 and 1964 who turn between 60 and 78 years old this year. Because of this, their time horizon for investments is shorter than that of younger investors who can allocate part of their portfolio to the long term. In this sense, it is crucial that they avoid entering into sustained bearish periods, according to Surz. “Baby boomers with small investment plans for retirement face the risk of losing their life savings in the next stock market crash,” says Surz. The S&P 500, an index that compiles the shares of the main 500 listed companies in the United States, hit a record price a month agoas shown below. For Surz, the upward trend is a bubble, that is, an unjustified rise, motivated by the demand for retirement plans.
SPX price over the past 15 years. Source: TradingView. In addition, the Buffett Indicator, a tool that assesses whether the market is undervalued, neutral or overvalued, is at an all-time high of 200%. According to the specialist, this underlines the possibility of a sharp decline.
Emerging markets could benefit, consultant warns
“Baby boomers are close to retirement [si no lo hicieron]which is a time when investment losses could ruin the rest of your life,” he says. For this reason, he believes that They should take control of their savings, move them to a safe place and make sure they are informed about their investments. Of course, this is a message that can also apply to younger investors looking for returns in the medium and short term. According to Surz, it is advisable to rotate from stocks to the dollar and assets considered lower risk such as Treasury bills and securities. Similarly, Avi Gilburt, who runs the analyst firm ElliotWaveTrader, foresees a long-term decline for major stocks due to the sustained rise, due to technical analysis. “My expectation is that we are probably going to be looking at a very prolonged bear market, it could be 10 or 20 years,” he has commented. However, according to Gilburt, some investments will be favored. He believes that Emerging markets have the potential to outperform the S&P 500 in the face of a rotation of capital to assets with better prospects. In any case, it should be noted that not everyone agrees on the bearish view for markets considered risky. According to financial consultants such as Nikolai Galozi, the expected interest rate cut for this year, which will lower Treasury bond yields, will lead to a rotation of these instruments to other assets. In this context, he expects bitcoin (BTC) to continue its bull market and the risk appetite to expand in the cryptocurrency market. Although he clarifies that, in principle, it could be pressured downwards, since the rate cut symbolizes a sign of weakening of the economy, so it is a policy that seeks to boost them. In fact, the fourth increase in unemployment in the United States last week is a reflection of the weaker economy, which fueled fears of recession triggering falls in the markets. Therefore, investors are attentive to the following economic data that offer signals about the situation. Meanwhile, players such as the investment firm Grayscale believe that bitcoin could benefit even in a recession scenario that affects the stock markets. They see this as a result of the value of its decentralized and limited issuance, which facilitates its price increase in response to demand, unlike the dollar, which can be printed indefinitely at the discretion of the government in power.