Risk of Recession Grows

According to Bloomberg Morgan Stanley is cutting its forecasts for Amazon, Meta, Alphabet, and Snap. They say that advertising revenue will fall by one to four percent. They contend that the likelihood of a recession has gone up from 5% at the beginning of the year to 35% now. As the risk of recession grows strategists at Citi report selling on rallies instead of buying on dips as folks like Fidelity are reducing their investments in the likes of Instacart, ByteDance, Stripe, and Reddit. And crude oil futures are still high and gasoline at the pump is over $4 everywhere in America.

This Is Not News at Top Gun Options

Here at Top Gun Options, we predicted that Biden’s second year would be a disaster. Interminable lockdowns in China are still gumming up that part of the supply chain. Russia’s war in Ukraine shows no signs of stopping. The US is sending more heavy weapons as the conflict starts to look more and more like a junior version of the First World War. Putin cannot back off without a clear victory and Ukraine will not stop fighting as Russia gobbles up 20% of its country, steals 200,000 children, and butchers its population. Inflation is up for these supply side reasons and Fed policies aimed at money supply will only handle part of the problem. At some point the Fed will “overshoot” as factors beyond its control get worse. We have spoken about potential disaster layered over the current disaster if the US and NATO get dragged directly into the fight as Putin uses tactical nukes, chemical weapons, or biological weapons.

Trading Options and Changing Tactics in a Moment

As we have repeatedly said, this market is heading lower yet. A problem for big investors is that they have to bear their losses or sell at the current price. Sell too much and you drive the market down farther. At Top Gun Options we do not have tons of stocks to unload. Rather we read the market and change tactics in a moment. As Americans we grieve the losses to 401ks and IRAs. As option traders we potentially print money no matter which way the market goes just like we did during the Covid crash and recovery. Remember that the 1929 crash was really the 1929 to 1932 crash because it was not just about wringing excess pricing out of the market. The same applies now as the potential for an even wider conflict in Europe, an invasion of Taiwan by China, the USA being sucked into both hang over the market.

Not the Time to Trade Alone

These are troubled times in the world and in the markets. These are also times of great opportunity. Whenever the world gets shaken up there are winners and losers. This is not the time to trade options alone because the odds of losing are great. Join one of the squadrons at Top Gun Options and potentially print money as markets fall, struggle to rise, and fall again. This will go on until the underlying issues are resolved. Unfortunately, both Vladimir Putin and Xi Jinping see potential gains by threatening, bullying, and then invading sovereign nations in order to expand their power and maintain control over their populations. The post-WWII world order is in peril. By working with Top Gun Options, you will have the benefit of getting insights from someone with a winning track record and the ability to think on their feet and change tactics in a moment when conditions warrant.