Malcolm Graham
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3 reasons a stock-market correction is coming in late summer or early fall

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Down but not out.

It’s August, the dog days of summer, but stocks just keep chugging higher. On Wednesday the Dow Jones Industrial Average DJIA, +0.00%  hit a new all-time closing high above 22,000, while the S&P 500 index SPX, -0.13%  and the Nasdaq Composite index COMP, +0.05%  closed near record peaks. The CBOE Volatility Index VIX, -1.07% the so-called “fear” index, at one point last week tumbled to a record intraday low below 9. It’s a bit higher but remains in a low range not seen in two decades. Low interest rates (despite the Federal Reserve’s goal of gradually raising rates and shrinking its balance sheet), strong corporate earnings, decent GDP and jobs growth with no real inflation, and the lingering hope for tax reform in Washington, D.C. have kept stocks moving higher. And except for potential geopolitical crises like North Korea, I don’t see anything on the horizon, especially a recession, that would keep stocks from advancing over the next year or so.

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