The Nasdaq is approaching its benchmark print of 5,000 exactly 15 years after we saw it first in March of 2000. And while the Dow and the S&P are doing a little bit better, their compounded ROI of 2.7% over the last 15 years make Treasury investing over the same time appear genius. Yet, you wouldn’t know it by reading financial press. According to most investors out there and despite today’s extreme overvaluation levels, this “secular bull market” (it’s not) is about to surge higher. For instance…..
“I don’t see too much concern because it really is a question of where else are you going to put your money. In a low-rate environment with concerns about Europe, Japan and China, U.S. equities are the preferred asset class.” said Erin Gibbs, equity chief investment officer at S&P Capital IQ Global Markets Intelligence.
Yes, the old “no concern, where else are you going to put your money” garbage. I can’t tell you how many times I have heard that back in 2000 and 2007. The unfortunate reality remains. No matter how positive things might appear to look, the stock market can turn on a dime and begin its bear market at any moment. And just as we saw back at 2000 and 2007 tops, there doesn’t have to be a fundamental catalyst.
As the bearish sentiment chart above so clearly illustrates, when most investors find themselves on the same side of the trade, things tend to unfold in the opposite manner.
What You Ought To Know About Today’s Bearish Sentiment Google