3/18/2015--Action Today Demands Revisiting this...
A few months back I did some analysis on past interest rate hiking cycles. It is entitled "Don't Fight the Fed." Given this market weakness and huge spike on the news that the Fed wasn't hiking rates in April but didn't rule out a June hike, that report needs to be re-read...as it appears to be spot on!
If you don't want to read it, here's the gist:
Markets, historically, have rallied right up to the rate hike. They don't slow down their gains a year in advance, or even a few months in advance. Rather they run hard until the Fed actually hikes rates. And THEN, after the rates begin to go up, the next year, or so, is a tough time for the stock market. Now, it hasn't historically been a blood bath...but the staggering gains which preceded the rate hike tend to slow down substantially.
It certainly appears we are on track for history to repeat itself.