“Ain’t nothing more dangerous than a bear at the end of a bear market,” Bank of America investment strategist Michael Hartnett said about the stock market in his latest “The Flow Show” report.
The analyst stated the stock market will attempt new lows over the next three to six months amid a confluence of factors, including history, policy and recession.
History says “sell the last rate hike” in an inflationary environment, as this was the correct stock market strategy during the inflationary 1970s and 1980s.
Contrary to what happened during disinflationary periods, the average Dow Jones returns after the last Fed hike in the ’70s and the ’80s were negative by 4.5% over the next three months and negative by 6.6% over the next six months.