national debt has moved above $30 trillion for the first time. We are in the second year of a bond bear market There have only been two times in history (1952-59) that fixed-income prices dropped in a two-year period - 2022 will likely be the third time.
There is over $250 trillion of global debt - much of which is variable rate. Many companies, like Starbucks ( SBUX), are being forced to markedly reduce operating hours in their stores around the country. Interest rates - both in the belly of the curve and on the long end - have surged noticeably. And so will the shortage of labor contribute to higher inflation - with hourly earnings rising +5.7% in the last 12 months. Ford further announced its intention to shutter eight factories in the U.S., Canada and Mexico to deal with continued chip shortages. As an example, recently (the very popular) Ford Motor's ( F) shares tumbled into a bear market after fourth-quarter 2021 revenue and profit failed to meet expectations with CEO Jim Farley warning of "persistent supply-chain disruptions" which limited the company's ability to meet strong demand. Continued supply chain and logistical issues will likely exacerbate the trends toward sustained high levels of inflation and in inflationary expectations. (Most notably the price of energy products - crude oil has advanced to $92 a barrel). The prospects for sustained and elevated inflation have risen. Revenue and profit comparisons are growing more difficult. Evidence of a slowing rate of domestic and economic growth has increased. 
However, the odds of a decline approaching 20% appears to be rising in probability over the near term based on the following: Doug Kass, Hedge Fund Manager Who Writes the Daily Daily on Real Money ProĬrashes, or greater than 20% declines in the market averages, are a rare occurrence.Īs my pal, Blackstone's Byron Wien, is fond of saying:
We asked TheStreet's Real Money and Action Alerts PLUS teams to look at whether the stock market will crash in 2022 and what that might look like for investors.
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