New York, New York (PressExposure) January 07, 2012 -- The Dow Jones Industrial Average in 2011, excluding dividends, rose 5.7%, up 10.8% from 2010 and up 18.8% from 2009, as reported by popular financial newsletter Profit Confidential. According to Michael Lombardi, lead contributor to Profit Confidential, the bear market rally that started in 2009 is getting near the end of its life.
"We don't have to look very closely at the numbers to discover the true trend," says Lombardi. "The Dow Jones Industrial Average returned 57% in 2010 of what it returned in 2009 and it returned 53% in 2011 of what it returned in 2010. The returns for 2012 will be meager at best if this trend continues."
Lombardi says the market returns are a reaction to the political events of the past several years. "Since Obama took office in January of 2009, the national debt grew by about $5.0 trillion."
Lombardi points out that, since 2008, the Federal Reserve has increased its balance sheet by approximately $2.0 trillion. Combined, this is an increase of $7.0 trillion in government debt and an increase in the size of the Fed's balance sheet. Lombardi believes that, if it were not for this $7.0 trillion, the U.S. would be in a depression and the stock market would be down sharply.
"I don't believe the government can increase its debt another $5.0 trillion over the next four years, as the public outcry would be too great, the damage to the U.S. dollar too severe," says Lombardi.
"The bear market rally still has some steam left, but it's getting old and tired," Lombardi writes in Profit Confidential.
Profit Confidential, which has been published for over a decade now, has been widely recognized as predicting five major economic events over the past 10 years. In 2002, Profit Confidential started advising its readers to buy gold-related investments when gold traded under $300 an ounce. In 2006, it "begged" its readers to get out of the housing market...before it plunged.
Profit Confidential was among the first (back in late 2006) to predict that the U.S. economy would be in a recession by late 2007. The daily e-letter correctly predicted the crash in the stock market of 2008 and early 2009. And Profit Confidential turned bullish on stocks in March of 2009 and rode the bear market rally from a Dow Jones Industrial Average of 6,440 on March 9, 2009, to 12,876 on May 2, 2011, a gain of 99%.
To see the full article and to learn more about Profit Confidential, visit www.profitconfidential.com.
Profit Confidential is Lombardi Publishing Corporation's free daily investment e-letter. Written by financial gurus with over 100 years of combined investing experience, Profit Confidential analyzes and comments on the actions of the stock market, precious metals, interest rates, real estate, and the economy. Lombardi Publishing Corporation, founded in 1986, now with over one million customers in 141 countries, is one of the largest consumer information publishers in the world. For more on Lombardi, and to get the popular Profit Confidential e-letter sent to you daily, visit www.profitconfidential.com.
Michael Lombardi, MBA, the lead Profit Confidential editorial contributor, has just released his most recent update of Critical Warning Number Six, a breakthrough video with Lombardi's current predictions for the U.S. economy, stock market, U.S. dollar, euro, interest rates and inflation. To see the video, visit http://www.profitconfidential.com/critical-warning-number-six