Editor’s note: Today, we’re featuring an insight from friend of Brownstone Research Mason Sexton.
He’s an expert market timer and Harvard Business School graduate who got his start on Wall Street in 1972… And has an uncanny knack for forecasting markets with shocking accuracy.
That includes the Black Monday crash of 1987… which he called to the day.
And next week, he’s hosting a special event in which he’ll reveal his next big prediction… including precisely when it will start, and what investors can do to prepare.
You can go here to sign up for Mason’s event. Then read on below for more from him about his famous Black Monday call… And more about what’s coming next…
I remember it to this day…
In my Long-Term Forecast 1985-1992, published in early 1985, I predicted that “in 1987, the stock market will enjoy its biggest rally in history.” The Dow Jones opened the year at 1,908 points. At the peak, two months before the crash, it was at 2,722 points.
People often forget the tremendous stock market rally of 1987. They only remember the crash. As it happens, I predicted that, too.
In an interview I had on August 14, 1987, I told CNN (emphasis added):
What we think will happen is that we’ll get an important top somewhere around August 24 or 25.
[…]
If I had to guess the final top, it would be the first or second week of October. When I say, the final top, that would precede a correction of 15% to 20% ‘minimum’ in the [Dow].
On August 20 of that year, I repeated my warning. When I was interviewed by the New York Post, I said:
We are seeing a top in the stock market in a generational sense.
As it happens, the Dow Jones topped out at 2,722 precisely on August 25 of that year. It was the all-time high for 1987. And it was a level that the Dow would not see again until two years later in August of 1989.
I’m sure many of us remember what happened next…
On Monday, October 19, the Dow Jones collapsed by 508 points, or 22.6%. It was, and remains to this day, the worst one-day drop for the index in percentage terms. Black Monday had arrived.
Of course, it’s one thing to make a prediction. It’s something else to follow through and tell people exactly what to do.
That’s what I did.
On October 2, 1987, I advised clients of my Harmonic Research newsletter “to sell all stocks.” Six days later on FNN (the precursor to CNBC), I advised investors to “Buy puts on the S&P index… short IBM, GM, PA, XON, and CHV.”
I don’t retell this story to bring up bad memories for those of us who were around for the crash.
But we must understand what’s at stake…
Investors who were prepared for the crash could have made a fortune. In fact, I later had a client brag about how her traders had turned $100,000 into $13 million over a few weeks by following my research.
But for those that were blindsided by the crash, it was devastating…
My name is Mason Sexton. For the better part of four decades, I have made a career for myself forecasting the precise movements of the markets.
I began my career on Wall Street after graduating from Harvard Business School in 1972. I spent three years in the Corporate Finance Department of Morgan Stanley. I did a stint with Salomon Brothers in M&A. Then, I headed the Sales and Research Department of Mabon Nugent & Company.
In March of 1984, I founded Harmonic Research, a bi-monthly newsletter for institutional clients that specialized in making uncanny, specific predictions for the market. The story above was based on my research with Harmonic.
Earlier this year, I came forward and launched New Paradigm Research. My goal was to share my unique forecasts and trade recommendations with everyday investors.
And we’ve been off to a phenomenal start…
In May of this year, I told my readers that:
Ninety days from the May 1 high puts us into late July. That would imply a trend change could well be underway by then. And it is highly likely that the first “warning signs” would begin to appear earlier that month. This suggests the beginning of a possible severe correction ahead that should be evident by no later than mid-July, 2023.
Were we to pick a precise date, we would select July 12 as the most likely “kickoff” for this decline. At first, there will be much “rationalizing” of the downturn. But by July 17–18, the coming correction will be more difficult to ignore. And by the end of that month, it will be impossible to ignore.
When that research was published in late May, it must have seemed contrarian, even a bit crazy. Not anymore…
The broader indices did peak in mid-July. Interestingly, the Nasdaq peaked precisely on July 18th. As we write, The Dow Jones has declined by as much as 9%. The S&P fell by as much as 10%. And the Nasdaq is off by as much as 12%.
The most popular stocks of 2023 have fared even worse since the July trend change.
Nvidia (NVDA): -17.3%
Advanced Micro Devices (AMD): -26.24%
Tesla (TSLA): -32.3%
It’s also not a coincidence that some of the biggest losers since the July peak have been among our favorites to short, which we have done successfully, and repeatedly, in recent months. And our readers have had consistent opportunities to profit.
Mr. Sexton,
What you do is IMPOSSIBLE. I am just glad that nobody ever told you that. I have profited greatly from your recommendations. In just two months, this is beyond believable. I pray that you live long and prosper!!!
– Pete B.
Mason, you are far better than AI. I started last month following your suggestions gingerly and most or all seemed to hit it on the nose. Recently, I have been betting more heavily on your suggestions.
In the last month, I have benefitted from your research to the extent of about $30,000 in a portfolio of just $180,000. You have me for life. I can’t wait for each missive from you.
– Ted B.
I share all this simply to show you that incredible returns are possible even in the most unforgiving of markets. But you must have an insight into what’s coming down the line.
That’s why I’m hosting a special event on Tuesday, November 14, at 8 p.m. ET. During the event, I will share my next prediction. I’ll also detail precisely when I believe it will start, and what investors can do to prepare.
If you are at all curious, then I would ask you to join me on that date: Tuesday, November 14, at 8 p.m. ET. You can reserve your seat with one click right here.
Regards,
Mason Sexton
Editor, New Paradigm Research
The Bleeding Edge is the only free newsletter that delivers daily insights and information from the high-tech world as well as topics and trends relevant to investments.
The Bleeding Edge is the only free newsletter that delivers daily insights and information from the high-tech world as well as topics and trends relevant to investments.
