The Market is Speaking, Are You Listening?

One of the great things about Wall Street are the people you get to meet. Yesterday was a case in point.

One Monday, I wrote up a commentary called Why Some Rallies Must Go On Without Us. It explained why there are occasions when the ducks don’t line up, and you have to let a rally come and go without participating in it. In addition to going out to RR&A subscribers, it also went out to a few people who share their research with me, and as a courtesy I return the favor.

Ironically, I get an email back from Jeff Saut (of Raymond James) yesterday, telling me he quoted that piece in his verbal comments to institutional clients.

At the time, I was working  on a multiple compression/valuation analysis — Its not how cheap it is, its how much buyers are willing to pay for it — that relied on commentary of Jeff’s!

I try not to get caught up in the Wall Street hall of mirrors, where everyone merely repeats what everyone else said. I do, however, round out my research by reading a few original thinkers and seeing their world views.

Jeff and I chatted about this by phone yesterday. I asked him about a recent missive of his: "The Market is Speaking, Are You Listening?"

It turns out that Jeff will be one of the keynote speaker this year at the upcoming MIM Retreat conference. That concept of listening to Mr. Market will be the topic of his presentation.

I checked out the Minyans in the Mountains speaker list, and its quite a crew: In addition to Saut, the other keynotes are by technician Tom DeMark, Barron’s editor Michael Santoli, and Thomson Financial Director of Research, Michael Thompson.

There were a few other names that caught my eye: Woody Dorsey of Market Semiotics, Jason Goepfert of Sentiment Trader, Stephanie Pomboy, of MacroMavens, and Bernie Schaeffer of Schaeffer’s Investment Research..


Looks like it will be a good time . . . I’ll bet Vail is lovely this time of year.

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  1. Fred commented on Jul 28

    I think Jeff Saut is one of the sharpest guys out there. I go read his stuff right after I read yours. ;)

  2. William commented on Jul 28

    The Minyanville site is a great resource. I’ve been a subscriber there for nearly a year, and now I’m addicted to it.

    And Vail is nice this time of year…but the Rocky Mountains are great anytime of year!

  3. anon commented on Jul 28

    r u going to be there as a speaker or audience. you should be there and get on the circuit. great way to travel the world (for free) and meet and greet. you are certainly as qualified as any to speak.

  4. Ricardo commented on Jul 28

    You forgot to include “Frank the Tank” from I’m a

  5. JB commented on Jul 28

    If I’m not mistaken, the markets say that they are tempting the bulls to join the ride only to slaughter them in the end. Even if the FED pauses with the rate hikes, according to Mr. Hussman, markets do not do well after a pause. Although many do not like Wave analysis, we are very close to wave 3 of 3 down. What I have been hearing from the markets is to short like crazy after this recent rally. Ah, does anybody else hear that? I could really use others input in order to try and sharpen my own thinking. Thanks and good trading.

  6. Scott Frew commented on Jul 28


    I’m listening as hard as I can to the markets, but they seem to be speaking a language I don’t understand at the moment. Given the action in the financials, and especially in the mortgage lenders, including those serving the subprime market, most of which are up 4 or 5%, they clearly think that the Fed no longer hiking will rescue the hapless homeowners facing ARM resets this fall and winter. And apparently a slowing economy doesn’t mean the consumer’s going to take a hit–quite the contrary. I see a diverse group of stocks leveraged to the consumer, whether directly or somewhat down the supply chain, ramping. So it seems like a best of all worlds situation. Economy’s slowing, but the glass isn’t half empty, it’s overflowing. There still seems to be an abiding faith in the Greenspan put; apparently a laying on of hands transferred it to Dr. Bernanke. Jeremy Grantham’s got a great description of moral hazard in his most recent market letter, and it seems to fit perfectly here (in paraphrase): Heads I win, tails I don’t get hurt.

    But wait–it’s also month end, isn’t it. I seem to recall that Thursday, June 29th, the second to last trading day that month, was a huge ramp. History’s repeating itself so far. Early July wasn’t pretty.

    Cheers. Enjoy the weekend.


  7. christopherrobin commented on Jul 28

    inflation was showing stronger signs. i am CONFUSED beyond reason.


  8. andiron commented on Jul 28

    and what about this week’s confirmation of a “solid” rally after last week’s surge (as per O’neil.)…Barry has gone, conveniently, quiet on that.

  9. Cherry commented on Jul 28

    But there was no confirmation. It is all FED based. Reality won’t slap them to September(maybe Augest), thus what is your point? Deal with the speculative bubble collapsing and move on. That is what builds character in tougher times.

  10. Barry Ritholtz commented on Jul 28


    I was out of the office this afternoon, so I am not confirming this on official data yet — but according to Yahoo, the Nasdaq and NYSE volume on Friday was actually lower than Wednesday or Thursday.

    Hardly what a confirmation day requires

    Let’s check Out IBD Saturday (Monday)

  11. Rusty commented on Jul 28

    Is it possible that a lot of recent market action is in part due to the drop in the 10 year yield? Since mortgage rates are derived from the 10 year, the runup in bond prices means a few more gasps of air for the housing market, and thus consumer spending, and so on. Conventional wisdom would say I’ve got the cause-effect backwards, but as Barry said earlier, the adults are in the bond market, so maybe they are actually driving the minivan to some degree?

  12. DBLWYO commented on Jul 28

    Barry & Crew – GDP is 2.5% instead of 3.2% and inflation is up and the markets rise ? The markets may be speaking but it’s a tounge new to me. My simple mind centers around PE, interest rates and earnings – if the l.t. trend in earnings is down then surely the market follows ? Well not so far but we’ll see.

    In the meantime another source of realistic pragmatism is Prof. Hussman. Try for further discussions.

  13. Alaskan Pete commented on Jul 28

    The market may be speaking, but it’s speaking Swahili ’cause I don’t understand a word being said.

    Transports bounced off long term support, but look ugly indeed. Several homebuilders looking at heavy resistance. Will they resume the downtrend? My money says yes (I’m short LEN)

    Dow is staring at some serious resistance in the 11,245 – 11,260 area and looks to be short term overbought. Looking to get short the DIA early next week. The oil:natgas spread looks ready to narrow, yet the XNG is at resistance in the 440 zone trying to break this for the 4th time in the last year.

    A/D lines across the board look sickly and the hi/lo lines are absolutely nasty. GLD is setting up in a triangle that should resolve relatively soon.

    So what am I saying? We are at what looks to me like a fairly significant juncture. Does the resistance hold? Can Erica win back John? Is the baby really Bob’s or does Joan have a secret? Tune in next week for the exciting conclusion of “As the WorldMarket Turns”.

  14. Mark commented on Jul 29


    It is sure looking ST overbought so I think you are right that next week is key. How in the heck does the fed ignore that PCE number though?

  15. DavidB commented on Jul 29

    The bulls are probably looking at the fact that GDP was down and that the housing market is beginning to falter and they are thus seeing an end to the rate hikes for a while.

    It’s a printing press rally

    As for Bernanke, he won’t truly be tested until things get bad and the screaming for rate drops get loud. That is where Greenspanic always buckled and that is where helicopter Ben will probably earn his nickname

  16. whipsaw commented on Jul 29

    If you want a glimpse at how bad things are in real estate, have a look at this journey from hubris to despair. Only took 7 months for Mr. Real Estate Professional to discover that The Slayer of All Dreams walks among us again. Something tells me that by March, he will be engaged in a new career in the food & beverage industry- “Welcome to IHOP, party of two?”

  17. John Navin commented on Jul 29

    Last time I drove across Vail Pass in the middle of July, tiny snowflakes were coming down slowly and intermittently on the windshield.

    Take a jacket.

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