Now Mr. Melt-Up Just Raised a Yellow Flag

An investment professional whom I read regularly can rightly claim the title Mr. Melt-Up. Except for a week or so after the precipitous drop in the stock market last year, he's been full-bore promoting the idea that we're in the final stage of the greatest bull market in history, with the greatest gains still to come. For those few weeks, he was clearly rattled. At that time, the idea that a "Black Swan" had descended on us provided a reason why the Melt-Up he'd promoted for months and months was derailed. But in due time, all was well again. The Melt-Up wasn't derailed after all.

The logic used about the Black Swan was never directly refuted. Maybe it wasn't a Black Swan after all. Or maybe it was a Black Swan that simply scared the wits out of us for, well, whatever the reason. 

In any case, Melt Up is back with a vengeance. But recently - and for the first time since this guy took the Black Swan off the table, he's waving a yellow flag. Not red, but yellow. Here's the story.

We're in a Bubble (Duh!) for sure. Things are crazy for sure. But the key is retain investors are piling into the stock market. And that's not been the case in sufficient numbers until the last few months or so. The whole Robin Hood-Redditt-Gamestop thing provides the background to this assertion.

With the big-time entry of the "little guy (and gal)" we've got the perfect recipe for the 3rd and final stage of this bull market in stocks. So our Melt-Up guy wants us to be aware and be prepared.

He makes recommendations - really urges his readers rather adamantly - for protecting yourself for D-Day. (Dump Day - the day investors start dumping stocks in huge quantities, with abandon.) He doesn't want his readers to be caught short.

But - and it a big BUT - he says stay in for now. Why? Because the greatest profits are made in this last stage of a stock bull market. In fact, that's true. So that means even if you haven't invested in stocks yet, or for a while now (because you've been fearful of a correction), go ahead and do so now. You'll stand to make a gob of money, as long as you have an effective exit strategy.

If you don't have an exit strategy, don't even think about it. You'll likely lose your shirt when the worm turns.

Could you sit on the sidelines and watch the eventual fireworks? Of course. But you'll miss out on what Mr. Melt-Up sees as relatively easy profits there for the pickin'. 

But wait, what of a potential correction? If that happens - and it turns out to be just a temporary correction on the way to further gains - just be prepared and ride it out. 

How about the question of when the eventual final turn will take place and the infamous Bear finally comes to town and stays for a while? Mr. Melt-Up thinks this year is a good guess. This. Year. As in 2021. 

So there's not a lot of time for all this to play out.

That means if you're gonna reap the rewards of Phase 3 of this Bull, get off your duff and get into the market, like now. 

I'll defer any comment about personal preference here. It really doesn't matter what I think. What this guy describes has occurred many, many times in the past. The pattern is classic. So it's not crazy to buy into Mr. Melt-Up's scenario.

All I will say is good luck and be very cautious if considering playing this game. Make sure you have the stomach for potential wild swings, and the self-discipline to take action when the time comes to bail out.

There are other ways to anticipate a Bear Market and even ride it out. But for today, let's stick with Mr. Melt-Up's way: getting out before you get fleeced.

You've been warned.