A subscriber writes: “I still am enjoying and using your services( MSR and GSSR reports). Fortunately, your momentum and technical indicators have been spot on the past 12-18 months, while the Kress cycles have had little impact. Do you think the cause of so many Kress cycle failures (particularly bottoms) in the past 12-18 months is a result of the market being taken over by Fed liquidity, not ever seen before on this scale? Do you believe the Kress cycles will begin manifesting a stronger impact once the tapering is complete? Any thoughts on that? One thing is for sure, markets have patterns, and at some point the Kress cycles will probably start showing their presence again.”
Answer: I think you nailed it in your final statement. The cycles will undoubtedly re-emerge once Fed interference ends. I'm convinced that the Kress cycles have become severely muted due to the unprecedented scale of QE. A case might also be made that the severity of the 2008/2009 market crash took some of the sting out of the longer-term cycles, but I'm more inclined to believe that the Fed has been mainly responsible for the cycle's diminution.