I noticed yesterday that the WSJ’s MarketBeat picked up quotes from both Raymond James’ Jeff Saut and myself, with each of us wondering where all the Bears went:
Such sanguine forecasts have the bears on Wall Street sharpening their claws. "Verily everybody is currently bullish on e-v-e-r-y-t-h-i-n-g, save me," writes Jeffrey Saut, chief investment strategist at Raymond James. Wall Street is experiencing a period of "upside hysteria given the various upside breakouts by the various indices as repeatedly trumpeted by the media." Barry Ritholtz of Ritholtz Capital Partners writes that the "noise out of the talking heads has been anything but bearish." He opines that "momentum is driving the market, with fundamentals taking a back seat …."
I guess the Journal is implying that we are 2 of the few commentators left making Bearish observations.
But the very best quote about the ursine absence comes to us from Richard Russell (via Jeff Saut’s comments):
“I’ve seldom seen a time when almost everything and everybody
appeared bullish. Bullish on the stock market, bullish on emerging
markets, bullish on commodities, bullish on the dollar, bullish on
housing, bullish on the economy. But there’s a problem. You see, the
great buys, the great profits, are made when we’re loading up on stocks
in the face of universal bearishness. When were stocks and houses a
great buy? The answer is during 1942 and 1949 and 1958 and 1974 and
1980. Those were major stock market lows, and stocks bought during
those times ended up providing their buyers big profits. Conversely,
stocks bought in 1966, or 1971, or 2000, when stocks were popular,
ended up giving their buyers headaches and losses.
Today, bullishness is in the air, people are spending with abandonment,
mergers and acquisitions are a daily event, volatility is low and no
one is buying puts, price/earnings are high and dividend yield is low,
and mutual fund cash is at record lows. Stocks bought in this kind of
atmosphere generally do not end up providing investor with profits.”
Richard Russell – Dow Theory Letters
Russell is an old pro who has seen every market bottom and top over the past 50 years — and according to Saut, called most of them correctly. (Saut’s address is temporary — if I can scare up a PDF, I’ll post it)
Note: the comments the WSJ quote is based on will show up here later this morning . . .