Why the bears are wrong

[nero3]

http://www.newsweek.com/id/206227

Good article

Bears: Exit Stage Left

Time for rock-star pessimists to wise up.


Comparing todays bears with the dot-com bulls. In my opinion, spot on.

[aaron]

Re: Why the bears are wrong

The article had very little substance backing it up, but it is an interesting comparison which one day may make sense.

I guess when the lady who cuts my hair tells me to buy gold or how to buy puts on the S&P 500, I will start to worry. I am not sure how the Internet Revolution went in your country, but here there was nonstop talk of CISCO, pets.com, etc, etc. It WAS a mania. Everybody with a job was "in the market" or was day trading "on the side." The rest were giving stock advice out to anybody who would listen (and that was a lot of people). So, at this moment in time the comparison is kind of premature.

[touchring]

Re: Why the bears are wrong

Ask Starving Steve how's he doing - http://www.itulip.com/forums/showthr...430#post109430

Ask the american banks if they have written off the ghost towers of florida - http://www.itulip.com/forums/showthread.php?t=10735

[Raz]

Re: Why the bears are wrong

"Today's über-bears are making the same mistake in reverse. They may be right about the challenges the world economy is facing—shaky banks, weak consumption, deleveraging, the flu pandemic, etc.—but they are paying insufficient attention to the prices that companies are trading at in the stock market. That is why they missed the sharp recovery of the past few months and are now desperate to label it a bear-market rally."

I'm paying very close attention to the P/E Ratio of the S&P 500, and it ain't cheap. Anyone who says differently is almost certainly using "operating earnings", and it's not cheap even when using that nonsense invented by Wall Street in the mid-1990s to justify overvaluation.

We'll see whose missing it. I think both bulls and bears may be dissapointed in this new government operated market.

I wonder how the writer made out in 2008. If he was heavily invested then perhaps he's exibiting the "desperate bullishness of the fully invested". If so, he's very short on details and methodology for his present optimism.

[Rotwang]

Re: Why the bears are wrong

Then we should consider the source. I'm not sure they have editorial sanction to use the D word regarding the current state of affairs.
The current Depression unfolding is different than any other recent financial/economic calamity. The foundations and structure of a system built entirely around ever expanding debt, at exponentially compounding interest is at the core of the breakdown.
And when you have a system nurtured on the functionality of ever expanding, and the cost of each new reset, looms ever larger, the political economic will evaporates and the incentives can no longer entice the ever expanding crowd required to feed the fire.
Flameout. For those that ever stood near a large fire. It is all too apparent that the firehoses will not save the burning structure.

[sishya]

Re: Why the bears are wrong

Yes the Bears were wrong in 2008, in that they
were more optimistic than how things turned
out in 2008

[LargoWinch]

Re: Why the bears are wrong

Comparing todays bears with the dot-com bulls. In my opinion, spot on.

nero3, you once again made me laugh out loud. thank you.

[Munger]

Re: Why the bears are wrong

I'm paying very close attention to the P/E Ratio of the S&P 500, and it ain't cheap. Anyone who says differently is almost certainly using "operating earnings", and it's not cheap even when using that nonsense invented by Wall Street in the mid-1990s to justify overvaluation.

Yes. The P/E10 is most certainly not showing a "bargain" on prices. If anything they are slightly above their historical long-term average.

Anyway - Nero fluctuates from bear to bull every 15 minutes, at each about face giving an astoundingly superficial rationalization. He is the physical incarnation of Graham's manic-depressive "Mr. Market."

[LargoWinch]

Re: Why the bears are wrong

Yes. The P/E10 is most certainly not showing a "bargain" on prices. If anything they are slightly above their historical long-term average.

Anyway - Nero fluctuates from bear to bull every 15 minutes, at each about face giving an astoundingly superficial rationalization. He is the physical incarnation of Graham's manic-depressive "Mr. Market."

Most of the time Nero reminds me of him:

[nero3]

Re: Why the bears are wrong

"Today's über-bears are making the same mistake in reverse. They may be right about the challenges the world economy is facing—shaky banks, weak consumption, deleveraging, the flu pandemic, etc.—but they are paying insufficient attention to the prices that companies are trading at in the stock market. That is why they missed the sharp recovery of the past few months and are now desperate to label it a bear-market rally."

I'm paying very close attention to the P/E Ratio of the S&P 500, and it ain't cheap. Anyone who says differently is almost certainly using "operating earnings", and it's not cheap even when using that nonsense invented by Wall Street in the mid-1990s to justify overvaluation.

We'll see whose missing it. I think both bulls and bears may be dissapointed in this new government operated market.

I wonder how the writer made out in 2008. If he was heavily invested then perhaps he's exibiting the "desperate bullishness of the fully invested". If so, he's very short on details and methodology for his present optimism.

It was not cheap at the end of the 1960s , and if you look at price/book, yields on gov bonds, it could be headed for something similar to then, meaning waiting could provide fruitless, as someone then would have had to wait for 10 years, while still missing a ton of opportunities. Inflation seems to be the wave of the future, but then who really knows.

On pessimism and the article: I think a lot of the writings, especially from bears these days are just a function of their negative personality (this kind of person will often be prone to pessimism, and even be negative at all times, listen to an interview with the guru Mish, sounds like he needs a Prozac) , and I feel that's what the author are hinting towards in a rather cynical and neutral way. Why should anyone listen to someone that don't have the fiber to make it in them.

One thing I notice in the worst bears, is that it seems to affect all aspect of their lives, leading to a general misery, and a lack of seeing opportunities, it is even stressing to talk to such a person. I even associate this bearishness with traditional values, religion, one of the worst I know of that is a public figure must be Alex Jones. He have a distortion in his mind, that makes him unable to think a straight line.

Just like you could size it up in an intuitive fashion and understand, that a certain dot-com guy would loose it all again, as he would never get down from his la-la land, just as well understand that Alex Jones is paraniod after listening to him for 2 seconds, it's just as easy to predict some bear will never understanding when there finally is a bull-market and finally get the balls to plunge in, and if he does, then the bull-market will be close to the end, or the correction be right around the corner. The writer seems to fit into the hardcore cynical category not bull or bear as he is doing that kind of thinking when he is comparing these polar opposites, yet similarities between the dotcom and now.

[metalman]

Re: Why the bears are wrong

http://www.newsweek.com/id/206227

Good article

Bears: Exit Stage Left

Time for rock-star pessimists to wise up.


Comparing todays bears with the dot-com bulls. In my opinion, spot on.

what a bizarre article. 99 out of 100 stories are 'green shoots' for every one that's bearish... and this article says the one out of 100 who was right about the bear market should join the bulls who were wrong about it.

how stupid. here, try this instead...

• November 1998: Warns on Internet Bubble
• August 1999: No Y2K Disaster
• November 1999: How the Internet Bubble Will End
• March 2000: Internet Bubble Top
• April 2000: A Bear Market is Born
• January 2001: Post-Bubble Recession
• September 2001: Gold Price Bottom at US$270
• August 2002: Warns of Housing Bubble
• January 2004: How Housing Bubble will End
• January 2005: Housing Bubble Correction
• June 2005: Housing Bubble Top
• October 2006: Recession Q4 2007
  
• December 27, 2007: Start of Debt Deflation Bear Market
• September 15, 2008: Fed Funds spread signals crash

add...

jun 2008... start of commercial property crash

mar 27, 2009... debt deflation bear market first bounce start

soon add...

jun 17, 2009... debt deflation bear market first bounce end

[nero3]

Re: Why the bears are wrong

Roubini, was he right, or was it simply a deep mishandling of the situation since 2007 that made him look smart for a while? Is someone good at seeing the kind of opportunities someone like Roubini is good at seeing, good at seeing the turn, and seeing opportunities that are contructive? I doubt it.

[nero3]

Re: Why the bears are wrong

Yes. The P/E10 is most certainly not showing a "bargain" on prices. If anything they are slightly above their historical long-term average.

Anyway - Nero fluctuates from bear to bull every 15 minutes, at each about face giving an astoundingly superficial rationalization. He is the physical incarnation of Graham's manic-depressive "Mr. Market."

Nice. Anyway. I feel the market's are primed for going up, in the coming week. I have been investigating the facts lately. That's my conclusion. You can't argue with testosterone. This baby is lifting. The market is going to go up.

[nero3]

Re: Why the bears are wrong

One thing that is really interesting, I have not read any articles about it yet, maybe some have some links? Is the super low volatility on the shanghai index lately, it's moving like a straight arrow. With the falling Libor, and the shanghai more stable than the dow jones, it all screams correction, had this not been a correction, the libor should had been trending higher, the shanghai should had been more volatile than the dow jones, etc.

[nero3]

Re: Why the bears are wrong

At last here is two companies that are primed for going dramatically up:

http://finance.yahoo.com/echarts?s=V...urce=undefined

Jblu, the airline, and Vimicro, all will have this early cyclical benefit from low commodity prices, and good profit margins, before the stagflation will take hold again. Just like the period between 2003-2004.