With the intentional policy to lower the value of the Euro to try to stimulate the European economy, the dollar will rise as we have been warning and we may see this reach all time record highs. This will then turn the US economy down after 2015.75 and you can see, smell, and taste this one coming.
The dollar will be forced higher and higher and this will then hurt the US economy from an export perspective. We still have to worry about the capital flows right now. They will help to provide a floor to US assets.
This is a interesting parallel to the events that set in motion the Great Depression. We could be at the 1927 phase when capital flows shifted into the USA. This may result in the US share market high coming in 2017 and the bond bubble for 2015. Rates will most likely begin to rise after 2015.75 as confidence in government declines.
We can see how the bonds turned down in 1927 and the next two-year phase sent capital pouring into the private sector forming the high in 1929. So anyone touting the TV financial-evangelists who proclaim their gospel stocks down with rising interest rates, will most likely lose their shirt, house, wife, kids, and the dog.
They lowered rates in the USA in 1927 to try to help Europe. Then as the capital flows shifted, the Fed was FORCED to raise rates because they were being blamed for creating a stock bubble. Of course, the rally into 1929 was set in motion by capital inflows, not domestic interest rates. Those in power respond to nonsense and ignore the global trend that is the real mover and shaker – not domestic.