The LAMPP (Liquidity And Monetary Policy Profits) indicator is little changed this week. It’s barely on yellow, perched precariously on the razor’s edge of turning red.
But there is more than one storm headed our way that will knock our LAMPP into a bright, flashing crimson.
Not only do we have an excellent idea of how the Federal Reserve and the Treasury plan to impact the economy, but the hurricanes that are tearing through the country will have tremendous repercussions as well.
In fact, they could change everything.
Here’s what you need to know to protect your portfolio from the coming storms…
I have studied and reported on the correlation between the direction of liquidity, what was going on in the US banking system, and stock prices for the past 15 years.
As you know, my efforts culminated in the development of the LAMPP indicator, which reduces the most important sources and uses of liquidity in the US market to a simple red light-yellow light-green light system that requires little interpretation. I update that indicator here for you every Monday.
Right now, the LAMPP is on yellow and getting perilously close to turning red (even before the Fed begins to reduce the size of its nearly $4 trillion balance sheet).
Here’s exactly how I know…