The following article was originally published by Michael Snyder at The Economic Collapse Blog. (Used by permission)
Do They Know Something We Don’t? Corporate Insiders Are Selling Stocks At The Fastest Pace In 10 Years
By Michael Snyder, Sept 2018
A lot of things are starting to happen that we haven’t seen since the last recession. A few days ago, I wrote about the fact that home sellers in the United States are cutting their prices at the fastest pace in at least eight years, and now we have learned that corporate insiders are selling stocks at the most rapid pace in ten years. So why are they dumping their shares so quickly? Do they know something that the rest of us do not? Certainly nobody can blame them for taking advantage of the ridiculously high stock prices that we are seeing in the marketplace right now. But stock prices have been very high for a while. Why is there such a mad rush for the exits all of a sudden? According to CNN, corporate insiders have sold 5.7 billion dollars worth of stock so far in September…
CEOs are using the market boom to quietly cash in their own chips.
Insiders at US companies have dumped $5.7 billion of stock this month, the highest in any September over the past decade, according to an analysis of regulatory filings by TrimTabs Investment Research.
It’s not a new trend. Insiders, which include corporate officers and directors, sold shares in August at the fastest pace in 10 years as well, TrimTabs said.
It would be one thing if September was an anomaly, but the fact that insider shares were being sold so rapidly in August as well indicates that this is a clear trend.
Could it be possible that these corporate insiders believe that the market is about to take a tumble?
Of course it doesn’t exactly take inside information to see the writing on the wall. On Wednesday, the Federal Reserve raised interest rates for the third time in 2018. Overall, this is the Fed’s eighth interest rate increase since 2015, and it looks like the Fed is anticipating three more rate hikes in 2019…
Looking ahead to 2019, Fed officials expect at least three rate hikes will be necessary, and one more in 2020.
“The Fed shows no signs of taking (a) breath in rate hikes,” Robert Frick, corporate economist with Navy Federal Credit Union, wrote in a research note.
This is terrible news for stock market investors, because every rate hiking program in the history of the Federal Reserve has ended in a stock market crash and/or a recession.
In fact, since 1957 there have been 18 rate hiking cycles, and every single one of them has ended in disaster.
So do you think that we are going to beat the odds this time?
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