Stephen Parker of J.P. Morgan Private Bank, Ellen Hazen of F.L. Putnam Investment Management and guest host Richard Fisher, former Dallas Fed president and Barclays senior advisor, join ‘Squawk Box’ to weigh in on Tuesday’s sell-off and what’s next for the U.S. economy.
The expert is wrong – in 2000 the stock market fell right after the yield curve inverted. The idea that when yield curve inverts stocks go up is totally false – and yet it was pushed on CNBC to its viewers.
One youtube viewer made this comment – “lets assume these idiots or liars are right … lets assume the stocks go up for a year after the curve inverts …. so what they want you to do is keep ur money in this stock market for one more year until the rally ends and then market collapses on your head and you lose half your money ?? if the crash is a year ahead i’d rather stay careful away from the massacre …. will they be able to pull out your money right before the crash ????”
In reality if a money manager sells stocks and they go up his clients will go into a range and take the money away from him. If he holds and stocks drop he can tell them some bad news made it happen.
And so most money managers are always bullish and at times talk nonsense to maintain the bullish views.