Posted on 05/30/2010 3:55:39 PM PDT by blam
Now Everyone Thinks The Market's Going To Crash
Henry Blodget
May 30, 2010, 10:23 AM
A month ago, with the market charging ever higher, climbing the "wall of worry," most bearish voices had been silenced. Now they're back with a vengeance.
(Why? Because, as we saw clearly at the depths of the market crash 15 months ago, what most people expect the market will do in the future is what the market has done in the recent past. The most recent past is a month in which the market has fallen more than 10%. So more people are getting bearish. If the market falls another 30%, people will get REALLY bearish. And the irony is that, by then, stocks will actually be attractively priced--much more so than they are today, and much MUCH more so than they were a month ago, when everyone loved them.).
In any event, Brent Arends in the WSJ observes how people are suddenly paying attention to the bears again. And many of those bears are predicting there's a lot more pain to come:
Some pretty smart people are cautious. Seth Klarman at Baupost Group is worried. John Hussman of the Hussman Funds says all sorts of warning lights have lit up across his screen. Even Ron Muhlenkamp of the Muhlenkamp Fund, who usually takes a sunnier view of things, says he has moved a big chunk of his mutual fund into cash in case there's a plunge.
How far will it go? Mr. Hussman says the technical indicators have only been this bad 19 times before in the last half century -- and on average the market plunged about 20% over the following 12 months. When markets were also high, like now, the picture's even worse.
Ugh.
[snip]
(Excerpt) Read more at businessinsider.com ...
I’ll add a hackneyed phrase to the mix. A bull’s next move is to sell. A bear’s next move is to buy.
I'm not in the stock market friend...thanks for your concern. I'm more into metals these days, heavy and precious metals. Good luck with you too.
Uncle Marx at the fiat federal reserve will print up a trillion one zillion dollar notes, Bre-X will sell for $20,000 a share, happy monkeys will fly out of obuma’s butt, covering America with endless pineapple mojito lollipops, and Mr. Magoo will drive us to paradise while we listen to one hand clapping.
Good grief!
Baron Rothschild-”Buy when blood is running in the streets”
Is it time?
I say no. They're still fighting going on in the streets and a lot more to come.
Albeit, my PhD son disagrees and has just financed two houses in Los Angeles (Sierra Madre) for $800+k.
I hope I'm wrong.
After last month we can see 20% down quickly.
You could a sentiment change in a matter of months if polls show Obummer being neutered in the mid terms. Until people focus on that however theres mostly bad news out there.
Bump for later
I think the prudent are de-leveraging. Those with extra capital and no debt are sitting in cash waiting for the Crash.
When people ask me when to buy stocks, I always tell them, “When blood is running in the streets”. Should not take more than another two years.
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