Contrary to what you may have heard on Bubblevision, U.S. markets
have been badly lagging the rest of the world’s bourses year-to-date. As Jim Picerno’s
nearby table makes apparent, the rest of the world’s markets have badly
outpaced those in the U.S.
This should come as no surprise, as the rest
of the world’s economies have similarly outperformed the "Bush Boom."
Ironically, this leads to some unusual if belated realizations.
Sandra Ward, Barron’s emerging market’s columnist observes:
"Ten years ago this month, financial calamity of nearly unprecedented proportions in the post-war period crippled developing Asian economies, spread to emerging markets around the globe, derailed the U.S. economy temporarily and ended up toppling one of the highest-profile hedge funds of the time. The Asian flu, it was called.
Now, emerging markets could catch a bad case of the American flu."
(emphasis added)
After this week, further evidence of this lag is showing up in all manners of ways.
Consider the Russell 2000 — the index of fast growth small cap stocks. IT IS NOW NEGATIVE YEAR TO DATE. This is especially significant, considering the Russell has been leading the Dow until about a year ago. (We noted the rotation here at the time).
>
Sources:
Is the Bloom off Emerging Markets?
SANDRA WARD
Barron’s July 30, 2007
http://online.barrons.com/article/SB118558544243180961.html
Russell 2000 Falls 1.72%, Into the Red for 2007
ROB CURRAN
WSJ, July 28, 2007; Page B3
http://online.wsj.com/article/SB118558949064081052.html
Here is what I don’t the market has only given up July’s and maybe some of June’s gains at this point but I read 23% of NYSE is at 52 week lows?
If I could use a Barry word favorite here I would say this looks like a “bifuricated market”.
The russell has been the leader by far in this recovery and is now lagging. Watch for the current market leaders to really begin breaking down if this selloff is for real.
Seeing as how “free trade” has caused
our manufacturers to set up shop in
those countries that have done well
it’s no surprise we lag.
As you’ve mentioned many times the Bush recovery job creation has been poor.
Barry,
I just watched Dennis Kneale, on Forbes on Fox. Of course he’s telling everyone this is a buying opportunity.
14,000 the Dennis Kneale Top
Two things I wonder about this morning are:
1. With the flight to safety in Treasuries, will those sovereign institutions that are loosing faith in the greenback (China, Russia, Oil exporting countries…) take this opportunity to sell into strength? They can reduce their $US exposure without riling the market at this moment.
2. Are the political winds re: the imbalances in the distribution of wealth in the US, particularly blowing ill for private equity and hedge funds, going to counteract the pressure for a Bernanke put?
Borrow, print, spend – is it any big surprise that the greatest debtor nation in history can’t keep pace?
“The main fallacy in monetary theory and policy is the confusion of money and wealth. … Money — and financial assets easily converted to money — may not be wealth for society as a whole if the production of goods and services has not kept pace with claims on it. Early spenders may have some success, but inflation will dilute the buying power of others. The bottom line is that real wealth has to be produced; it can’t be printed.
—Bob McTeer, former Fed governor”
When you look around, you begin to wonder how much value there is in money when art auctions are doubling and tripling the anticpated sales prices, commodity prices have exploded, and prices paid for some commercial real etate is completely out of proportion to expected returns.
It reminds me of an analogy I once read to consider what happens in an auction when the counterfeiters show up.
One truth is self evident – inflation precedes deflation.
And as Abe Lincoln might have said: “A house loan divided and leveraged times ten cannot stand.”
How much of the emerging market rise is due to U.S.-based hedge funds chasing returns overseas due to the falling dollar? And if they sell to cover their Yen carry trade borrowing, the emerging markets may be faced with a precipitous decline no matter their booming economies. Would the Chinese government freeze sales by foreigners if faced with such a scenario?
Or would the Chinese government use some of their dollar surplus to support their stock market?
i can barely describe how bad the credit markets were on thursday and yesterday. it did indeed feel like the end of the world. the pain out there amongst banks/hedge funds/portfolio managers in credit is incredible.
the moves in credit spreads over the last month are something equivalent to a 40% drop in stock markets (my ballpark estimate), i can’t believe how well equities are still trading. the underlying economy, and the ability to borrow money, is SIGNIFICANTLY WORSE TODAY than it was last year. And the SP500 was at 1250 last May. Common sense tells me it should be closer to 1000 today. I think the equity market is going to be following the credit markets, I’d be expecting a several hundred points fall in the S&P in the coming months.
and all those harping on about inflation…i think you should be having a long hard think about the coming DEFLATIONARY environment as leverage is purged and willingness to extend credit is cut right back. 10y Treasuries back to 3% anyone?
But Larry Kudlow told me it was impossible to grow your economy with “socialism” but all these socialist economies seem to be outperforming the USA
Ryan,
So you think it’s a good idea for the US to bomb Iran? Kudlow is full of just brilliant observations.
No doubt AHM’s pulling of it’s dividend at 10pm on payday will spread a few flu-bugs. (Isn’t this about equivalent to BK or NYSE delisting?)
http://www.rttnews.com/sp/Quickfactsnew.asp?date=07/27/2007&item=201
i wouldn t worry about this correction. we are way oversold short term. we may have a capitulation early monday morning but then watch for an awesome snapback rally of 350 points or more in the Dow in one day.
i m loading the boat on monday morning.
this reaction is way over the top. the bears will have a week or so of vindication but be careful of a short squeeze to take us back up to the previous highs.
(Neither endorsing or condemning, merely offered for your perusal)
James Stack, president of Stack Financial Management based in Whitefish, Montana, on Friday’s Nightly Business Report:
COMPLETE TRANSCRIPT
.
The markets seemingly have gone full circle, from future discounting of gains to daily reactions on news and earnings and now back to future discounting – only this time the discounting is of unrealized financial losses that the market is attempting to price – but it may not be enough.
From Reuters: “The new report, ‘Financial Services Exposures to Subprime,’ said ‘there are many institutions with significant levels of embedded losses that have not yet been recognized as a result of questionable valuations.’
Today, only a few banks and brokerages have recognized losses on U.S. subprime mortgage bets, as the housing market has weakened.
Today’s investors and financial institutions are now ‘playing a dangerous game,’ Rosner said on Friday. ‘The losses will almost certainly be larger than they are today.’
As more rating downgrades come, values will continue to fall and margin calls will increase, the report said.”
Surely, the wrong siders in the derivitives markets are getting crushed – but where are the losses?
Joe Klein:
I was obviously being sarcastic. Larry Kudlow’s version of economics and politics is so simplistic that it’s ridiculous. Plus, if you’re talking about taxes in a global economy, the one that matters the most for attracting foreign investment is the corporate rate and the corporate rates in Europe are lower than the USA.
the sell off all started when nippon oil agreed to pay iran in yen for it’s oil..instead of bombing iran maybe we should bomb nippon oil lol…thats why we attacked iraq…they wanted to be paid in euros for their oil.
~~~
BR: That was 2 weeks ago:
http://biz.yahoo.com/ap/070718/japan_iran_oil_yen.html?.v=1
Expect a big short-covering bounce next week.
When (and if) that rally fails, we’ll see if this is the start of something big.
If we had spent the amount wasted on the Iraq war to revitalize our economy, develop renewable energy sources, and improve our infrastructure, grown our own crops instead of plowing them under to build McMansions, and valued craftsmanship of our products over cheap Chinese imports, we wouldn’t have this problem.
But then, that would be Al Gore’s presidency, wouldn’t it?
Americans are stupid.
We cannot have the start of a bear market with GDP of 3.4% and when the books like Financial Armageddon and The Second Great Depression are popping up like mushrooms everywhere. This is the bottom.
http://www.amazon.com/Second-Great-Depression-Warren-Brussee/dp/1591136881
I am loading up the truck.
Quote Disclaimer: “We cannot have the start of a bear market with GDP of 3.4% and when the books like Financial Armageddon and The Second Great Depression are popping up like mushrooms everywhere.”
How quickly we forget – don’t you remember? It’s different this time.
Ten Reasons to Buy Stocks This Week
1. This was a normal 5% bull market pullback / correction.
2. US economy is strong (Q2 GDP is 3.4%); global economy is even stronger
3. Inflation is low and under control
4. Interest rates are historically low; 10-year treasury yield is only 4.8%
5. Yen carry trade unwinding is temporary
6. Companies profit worries are overblown; so far 65% of the companies reported beat estimates, Q2 profits are in double digits
7. Small sub-prime losses will be absorbed without any financial crisis
8. Pension funds are pulling their money from corporate bond markets (corporate bonds become less attractive relative to stocks) and will reinvest the funds into stocks
9. After a week of heavy selling, no one is left to continue selling but pathetic shorts
10. Stocks are on sale, with forward P/E of 15
Disclaimer —
GDP growth was 6% when the market topped in April 2000. GDP was negative when the market bottomed in 2002.
Markets are forward looking — they top when conditions are bright and bottom when they are dismal.
As for “Financial Armageddon” — it is currently #1972 on the Amazon bestseller list. Not exactly burning up the charts. Books like these are constantly coming to market — there’s always a (small) audience for doomsayers, and there always will be.
If you’re bullish, great. The dip-buyers have been right for the last five years, and they may well be right again. But if you’re right, it will have to do with what happens on a *fundamental* level in the global economy going *forward*.
Winston Munn,
Dow 36,000 marks the top. (According to Barry Ritholtz)
Then The Second Great Depression marks the bottom.
Are you suggesting it is different this time and The Second Great Depression marks the top?
Oh, I forgot. “The Second Great Depression” is ranked #9800 on Amazon’s best seller list.
Harry Potter, look out!
Speedlet: “GDP growth was 6% when the market topped in April 2000”
What was S&P 500 P/E in 2000?
In 2000 the stock market was extremely overvalued.
Nowadays, S&P 500 P/E is only 15. The market is even cheaper now than it was when the market bottomed in 2002
Quote Disclaimer: “Are you suggesting it is different this time and The Second Great Depression marks the top?”
All I am suggesting is that the relevant negative news and events over the past couple of years has been brushed aside with claims that it won’t stop the runup of the market because “it is different this time”. I’m simply wondering why “being different this time” doesn’t apply equally to any positive news or contrarian indicator.
True. Stocks are not as overvalued as they were in 2000. But that’s not saying much.
According to my Wall Street Journal (this week), the Nasdaq 100 trades at 35 times earnings. According to the Wall Street Journal, the Russell 2000 trades at 39 times earnings — which is actually higher than it was during the 2000 top.
According to the Wall Street Journal, the Dow trades at 17 times earnings — which is on the high side, but not by much. Except this number is skewed somewhat by the low P/E’s of the Energy sector.
You may want to use forward earnings to make the numbers look better, but the oft-cited long-term median price of “15 times earnings” is based on trailing earnings, not forward earnings. You’d be comparing apples to oranges.
What’s more, these are all multiples of what may well be *Peak* earnings for the cycle. If corporate earnings start to drop, the P/E’s will rise. We witnessed this during the collapse of the tech bubble, when tech-stock P/E’s *rose* even as the stock prices fell, because earnings were falling faster than prices.
The upshot of all this is — stocks are not cheap by historical measures. They haven’t really been cheap (i.e. on a price-earnings/book/dividend yield basis) for over ten years.
But that doesn’t mean they can’t go up. In fact, I would almost bet on a violent short-squeeze next week. And as we’ve seen, valuation means little in the short term.
So if you’re feeling bullish — by all means, buy stocks!
1. This was a normal 5% bull market pullback / correction.
— This is a prediction, not a fact. Whether it is a “normal” bull market pullback is something we can only know in time.
2. US economy is strong (Q2 GDP is 3.4%); global economy is even stronger
— Last quarter’s GDP number is irrelevant to what the stock market is going to do in the future — what matters is what Q3 and Q4 look like. The Global Economy is leveraged to the American consumer. If America sneezes, they catch a cold.
3. Inflation is low and under control
— Only if you don’t drive, eat, pay tuition, healthcare, insurance… the government’s inflation numbers are designed to exclude inflation itself. “Inflation ex-inflation” as Barry has called it.
4. Interest rates are historically low; 10-year treasury yield is only 4.8%
— What matters is the cost of capital to businesses and consumers, which is currently on the rise.
5. Yen carry trade unwinding is temporary
— How do you know this? This is a prediction, not a fact.
6. Companies profit worries are overblown; so far 65% of the companies reported beat estimates, Q2 profits are in double digits
— Again, what matters is what happens going forward.
7. Small sub-prime losses will be absorbed without any financial crisis
— Prediction, not fact. Besides, ask any bond trader and he/she will tell you: this IS a financial crisis.
8. Pension funds are pulling their money from corporate bond markets (corporate bonds become less attractive relative to stocks) and will reinvest the funds into stocks
— Prediction, not fact. Pension funds have asset allocation models that require them to rebalance — i.e. put more money into bonds, not less. Moreover, there are other things besides stocks — they can seek the shelter of Treasuries, as they have done, or simply wait in cash.
9. After a week of heavy selling, no one is left to continue selling but pathetic shorts
— No one is left to sell? All the stocks have been sold? No one owns stocks anymore? News to me. If this were true, the Dow would be at zero.
I don’t know how long you’ve been at this, but “a week of heavy selling” is nothing. Stocks can sell off for years on end. And the shorts haven’t been “pathetic” this week at all.
10. Stocks are on sale, with forward P/E of 15
— I’ve already addressed this one.
Guys, I am LOVING this debate!
the top is in because 20 year bear richard russell went bullish a few weeks ago……its over
I believe the easiest way to look foolish is to make unequivocal statements, so that is the reason I will only say that my belief is a top is more likely to be forming than a continuaton pattern.
I could give a litany of reasons individually but that would take too long. Suffice it to say that what I am seeing is a combination of events, some from the 1929 top and others from the 1987 top, that leads me to believe the well has run dry.
A few months ago in one of my first posts on this site I stated the one thing that could stop the bull market would be a credit crunch – regardless of the spinmeisters at work, it would appear that we have only seen a glimpse of how severe the money pinch will be, and it wouldn’t take much more to turn this mini-rout into a full-fledged credit crisis.
And then the real correction occurs – when the margin calls go out.
Too many “experts” aboard today. I rather wait until the market opens on Monday and make my investment decisions then.
Speedlet,
What was S&P 500 P/E in 2000? Obviously, you do not know.
Here are the facts:
When the market topped in April of 2000, S&P 500 P/E was 29.31 (twice of what it is now).
When the market bottomed in 2002, S&P 500 P/E was 46.45 (three times of what it is now)
Last time S&P stocks were as cheap as they are today was in 1995; and less expensive as today in 1989.
Are you one of those bears who have been shorting stocks for 20 years because you think that the “stocks are not cheap by historical measures”, not as cheap as in 1989?
Have you noticed that you are contradicting yourself?
You say that “markets are forward looking” and later you refuse to accept S&P 500 forward P/E of 15, instead you are using 12-month trailing P/E of 17 (I guess because it is larger by 2 points).
You are making analogies between 2000 and 2007, but you do not know how expensive the stocks were back then. (comparing apples to oranges)
You are making statements that the “markets are forward looking” therefore you do not care about the FACTS (GDP and earnings); and later you contradict yourself by saying you do not care about the FUTURE (predictions), you want the facts — “This is a prediction, not a fact.”
How is it possible to have the facts (something that actually exists) about the future (something that will exist or happen in time to come)?
I rest my case
It is amazing how the bears have been thinking tangentially, predicting the recessions, secular bear markets, and financial crisis every quarter since 2003; and they have been wrong with their predictions for 14 quarters now.
The score is Bears 0 : Bulls 14.
Stock markets plunge, “but be careful of a short squeeze to take us back up to the previous highs.”
I’m sure the shorts are shaking in their boots.
I had to pull out the old Elitist-to-English dictionary along with the Federal Reserve Substitution Thesaurus, but it was worth it to finally see this admission in print. Note: translations are in (parenthesis).
“The big risk (Yes, that is piss in my boots) in the coming weeks and months is that you get forced selling (F#$%ing margin calls!!!) of credit with institutions, both from the hedge fund side and the bank side, (We’re all freaking doomed)” said Bob Janjuah, chief credit strategist at Royal Bank of Scotland Group Plc in London. “The global economy is a debt-fueled (a Ponzi scheme), confidence-based scheme.(con game). All assets are and will be impacted. (We are So freaking doomed!!!)”
And I always enjoyed this line and scene from the movie “House of Games” where Joe Mantegna explains to his ultimate mark, Lindsay Crouse, the con game (“It’s called a confidence game not because you give me your confidence but because I give you my confidence.”) before he demonstrates a quick swindle on a marine, waiting in a Western Union office for his cash to arrive, by pretending to be a fellow marine and telling the marine that if his money got their first he would “lend” the marine the amount he was waiting for, getting, as expected, the same “promise” in return from the marine.
Here, let me leverage you up 10 times. I know you are good for it.
Or as Bob Janjuah so aptly puts it, “The global economy is a debt-fueled, confidence-based scheme….
The House of Games
Actually, I knew what the S&P’s P/E ratio was in 2000. But thanks for reminding me!
As your own figures indicate, the P/E was *higher* in 2002, even after the S&P was cut in half — from 1500 to 750. That’s because the “E” was falling faster than the “P”.
This illustrates the problem with “forward earnings” — the term implies that we know what the future holds, when we don’t. Reported earnings are facts; projected earnings are nothing more than predictions. If you were around in 2000, you remember that “projected earnings” can evaporate pretty quickly.
That’s the danger we face at the moment — that corporate earnings going forward will fall, due to an across-the-board credit crunch that affects corporations, consumers, homeowners, emerging markets, the works.
What makes the markets so difficult is that the “facts” are already reflected in stock prices — they’re yesterday’s news. We can only use them to extrapolate predictions about the future. But at important inflection points those predictions are often wildly off. Just ask the guys at Bear Stearns.
I am not a “bear” per se. I don’t really know what the market is going to do next — unlike you. I do know that the business cycle is tied to the credit cycle — in which credit is created in expansions, then “worked out” (i.e. crunched) in recessions. This is normal, and healthy, though sometimes painful.
I also know that an unprecedented amount of debt has been issued the last few years, in unprecedented forms (i.e. liar loans, negative equity, etc.). A lot of it is going to have to be “worked out” in the next few years — that’s already taking place.
What I don’t know is how wide and deep that ocean of bad debt is, and neither do you. Because the problem isn’t just “subprime”. The problem is that the underlying collateral behind all these loans — prime and subprime — is getting marked down as well, creating a spiral of higher rates, tighter lending standards, lower housing prices, then higher defaults, which in turn leads to… higher rates. I don’t really know where that cycle ends, and neither do you.
I actually hope that it all blows over, for everyone’s sake. I hope it turns out to be Y2K — a lot of worry over nothing. But somehow…. I don’t think that’s how it’s going to play out.
It’s also entirely possible that this may be a hiccup, and the music hasn’t really stopped… yet. We’ll know soon enough.
My suggestion to you, since you’re so bullish: open a margin account, if you don’t already have one. Then back up the truck and load it up with FNM.
“In 2000 the stock market was extremely overvalued.
Nowadays, S&P 500 P/E is only 15. The market is even cheaper now than it was when the market bottomed in 2002”
Maybe, but a P/E of 15 can’t be qualified as cheap by historical measures. The reversion to the mean started in 2000 implies a further drop in the P/E to single digits.
Another important consideration: Corporate profits have been very high during the last several years, partly at the expense of the average worker. FYI: This is not an observation emanating from the International Communist Party, but from an article published by a Goldman Sachs chief economist in 2003. (Can’t find the ref! Grrr!)
Obviously, this situation won’t last forever. Neither will the extremely favorable corporate bias of Washington political elite as a whole. Voters get weird ideas sometimes: they get to elect people that will really side with them.
It’ll be interesting (and probably quite ugly) to see what happen to the P/E then.
Francois
Winston,
You do contradict yourself (quite a lot). You’re no bear, you’re no bull so what are you? LOL Just have nothing better to do tonight?
Suge
“What’s more, these are all multiples of what may well be *Peak* earnings for the cycle.”
The most salient point of all. Profit margins, as a percentage of GDP, are at all-time highs. If any measure of value is mean-reverting, it’s profit margins.
American Home Mortgage going down won’t help the market on monday
Not everyone has suffered.
MKP Capital, an investment company that has hedge funds focused on mortgage-backed and asset-backed securities, bet the market would fall apart and its investors have profited handsomely. MKP Credit, one fund, is up 7.3 percent for July and 22.3 percent for the year, while a distressed fund, MKP Credit II, is up 5.5 percent for July and 13.1 percent for the year, according to a person briefed on the fund’s results. NY Times 7/28.
Yeah, now all they have to do is collect their winnings from the losers.
Is this when counter-party risk ensues?
BINGO, we have a winner – Tom Slater
Just think if IBM had invested in and hired 53,000 US citizens. Oh damn, I forgot, most of us woke up one day and forgot how to do our jobs and had to be replaced by smart Indians with no cultural knowledge and gross language deficiencies.
“Winston,
You do contradict yourself (quite a lot). You’re no bear, you’re no bull so what are you? LOL Just have nothing better to do tonight?
Suge”
Just waiting for the blue pill to kick in.
Winston,
In order for the blue pill to kick in, you have to wash it down with a few shots of vodka.
Suge
Cheapest Stocks in 16 Years
http://www.bloomberg.com/apps/news?pid=20601087&sid=a4tg9V99WLjU&refer=home
Scott Frew, as quoted by Barry Ritholtz, makes the case better than I can:
“Pervasively bullish investors and commentators have puzzled over the market’s decline, searching to explain the seemingly inexplicable. They view the market as genuinely cheap, and the economy as sound and strong. One can always torture statistics (comparing forward operating earnings to trailing GAAP earnings, and the like) to make markets look cheap. But by the methodologies that have most consistently predicted future returns, Tobin’s Q and some version of a cyclically adjusted (adjusted to reflect the fact that earnings are enormously cyclical and mean-reverting) P/E, stocks are anything but cheap. The chart below is taken from Robert Shiller’s website, and uses trailing ten year earnings in order to adjust for the fact that we are, at the moment, in a period of unusually high earnings. As you can see, the market only looks cheap when compared to the previous peaks in 1929 and 2000. This does not bode well for future returns.”
Read the whole thing, and study the charts, at:
http://bigpicture.typepad.com/comments/2006/05/will_cheap_stoc.html
Note: the above quote dates back to last summer’s decline. As you’ll remember, we had a huge rally coming off that decline.
So let this serve as a caveat to the bears: just because stocks are overvalued doesn’t mean they can’t rally huge from here.
Widespread Pannic?
A) a Great Band
B) when you BUY STOCKS!
http://www.tradersnarrative.com/put-call-ratio-reaches-extreme-panic-zone-1201.html
What is the Smart money doing??
The latest Commitments of Traders report, released this afternoon and covering positions as of this past Tuesday, showed that commercial traders in the equity index futures added yet again to their record net long position, pushing it up to $24 billion.
speedlet:
I appreciate your comments. It seems to me you are neither bearish nor bullish but simply practical, and like most of us here are trying to pan nuggets of reality from the media river of bullshit.
Frankie:
At this point in time can there be any “smart money” out there. Consider this:
“Ray Dalio of Bridgewater Associates – a venerable hedge fund manager who shuns the spotlight and the charity circuit – has one of the most solid records you’ll ever find. He told investors on Friday that he and his colleagues embarked on an extensive study a few months ago to determine the extent of the derivatives risk.
Their conclusion: “no one has a clue.” According to Dalio’s calculations, derivatives exposure has risen more than fourfold in the last five years to a staggering $400 trillion. Yes, that’s $400 trillion with a T, or 30 times the entire gross domestic product of the U.S.”
No one has a clue.
But I do notice that Paulson is back in China again – they can’t be a good thing.
Then again, maybe Paulson does have a clue.
I see Winston…so in a deliciouse turn of irony from your prior posts…this time IS different??
hmmm…
If history rhymes (stastically speaking) you buy when the market panics.
…it’s NOT different this time!
No, Frankie. What I am saying is that those who have been claiming that “it is different this time” were wrong, that it is no different this time than any other time – because the markets are made up of people, and human nature does not change.
You may well be right that it is time to load up – personally, I think that position is too aggressive and too early.
I am of the opinion that these past two weeks have created a fundamental change in the psychology of the markets, and bad news will no longer be brushed aside as an irrelevant irritation that only acts to temporarily interrupt the buying frenzy – the real possibility of severe loss has re-entered the picture, and that changes the dynamics of the marketplace.
Frankie, as to the COT relevant quote you posted from Sentimenttrader.com, you conveniently forgot to read the next paragraph. “I mentioned last week that I was starting to become somewhat disillusioned with the report since traders were acting so much differently than they had been during the past seven years. This is an ongoing concern, and we should keep watching the CFTC (the regulator of the futures markets) to see if they make any statements regarding the reliability of the data in regards to complicated swap transactions that already forced them to change the reporting for some agriculture and energy contracts.”
Since Jason (of sentimenttrader) is viewing the #’s as potentially suspect, maybe you should too.
This is really an interesting debate about what is going to happen. It’s going to be a see-saw battle between a collapsing housing market and credit problems and a global economy that is still extremely strong and P/E ratios that are reasonable. I’m really interested in seeing who is going to win the battle.
Nice posts Frankie…
No one ever makes money panicking. We will probably chop around in here, and retest Friday’s lows, before blasting off…last chance for those of the ursine persuasion to cover.
Good luck.
“Oh, I forgot. “The Second Great Depression” is ranked #9800 on Amazon’s best seller list.”
Thanks for looking at the Amazon rating on one of the better days. Sometimes it’s worse!
Incidentally, I presume people actually read my book before they assume it has no merit!
Warren Brussee, author of “The Second Great Depression.”
“Starting 2007; Ending 2020.”