With the S&P’s as of Friday’s close up 26% off the low of 666, it’s fueled the debate of whether the bottom is in or is it just another bear market rally. With opening day in baseball today always engendering in fans the eternal optimism that this is the year, especially for Cubs fans (no disrespect to the Cubs as I’m the Cubs of my fantasy rotisserie league, aka, never won), the bulls are thinking the same that 2009 is the bear killer.
What has made the call much more difficult is the money printing and easy money path of the Fed and other central banks as the inflation that will ensue (that’s their main goal) can result in nominal returns in equities but not real returns. As the S&P’s have rallied 26%, the CRB is up 15%. It’s like a Cubs hitter that smacks a lot of home runs in Wrigley Field b/c the wind is always blowing out but can’t hit one on the road without the help of the wind. The stats look good but it’s not real.
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