Recently, I was trying to explain why I made money in both the real estate market and the stock market between 2000 and 2005, but the economy wasn’t really that good. So I did a little research and found charts showing the Dow Jones Industrial Average for the past 10 years. I also found charts of the federal funds rate and real estate sales for the same period. When I compared the charts, I found some interesting correlations between the current housing market, the federal funds rate, and the stock market.
I saw that the last time the housing market had this much inventory was in January 1996. When I looked at the Fed funds rate in that same year, it was also increasing between 4.75 and 5 percent and that’s where they are now exactly 10 years. later. So if we look at the stock market at that time, it was also reacting in the same way as it is now. With all this research, if you believe in the money movement strategy that states that wealthy investors tend to move money between stocks, bonds, real estate, and money markets. Where do you think the stock market is headed? I strongly believe that we will see very bullish activity in the stock market for the next 2-3 years.
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