Ted Bauman is an economist who believes the US bull market in stocks is about to come to an end. Mr. Bauman earned his economics degree while living abroad in South Africa. He took on managerial roles in housing projects aimed at helping the poor. He has become an expert on low-risk investment strategies and wealth preservation techniques. He writes three newsletters for Banyan Hill Publishing and has over 100,000 subscribers. He has helped many individuals make smarter financial decisions over the years. He has been warning his subscribers that there could be a stock market crash in the future and he provides investment advice that individuals can take to weather the financial storm he sees coming.
Ted Bauman feels that there are several factors that could ultimately cause US stocks to crash. He feels that stocks are more overvalued now than almost any other time except for the dot.com bubble. He feels that if traders all come to this conclusion, stocks could begin to fall rapidly. He uses the CAPE ratio to come to the conclusion that US stocks are extremely overvalued. Another factor he feels could hurt US stocks is the trade war with China. The trade war could cause a global recession and the US stock market has fallen in pretty much every recession. Ted Bauman also feels that higher interest rates could cause a stock market crash. Higher bond yields could entice investors to flee the stock market and place their capital in the bond market.
Although Ted Bauman is forecasting a stock market crash, he warns investors not to try to time the market and sell all their stocks. The market could bounce back up, similar to 1987 after the great Black Monday crash. Investors who held their investments ended the year with a ten percent rate of return. Mr. Bauman feels that the trade war has made many Chinese companies cheap and it may be wise for US investors to sell some overvalued US equities and rotate into undervalued Chinese equities. He also advises investors not to neglect bonds, as they could be instrumental in cushioning an investors financial portfolio in a stock market crash.