9/10/2015 – A positive day with the Dow Jones up 78 points (+0.48%) and the Nasdaq up 40 points (+0.84%)
Billionaire hedge fund manager David Tepper has quite a few things to say about the market. To watch the video, Click Here
Tepper: Every dip should be bought, but that is no longer happening. If the market has reversed, then every rally should be sold. I am not sure which way the river is flowing right now. Nobody knows, hence the volatility.
My Comment: I did my best to outline on this blog, over the last 12 months, exactly where this river is flowing. Things like NYSE, largest index by capitalization, distributing for over a year. Us being stuck in a tight trading range on the Dow. The 5 year bull market cycle terminating. Interest rates, QE, the FED, etc…. The fact that all secular bear markets, including this one of 2000-2017, terminate in a 2-3 bear market. I don’t know about you, but I think its fairly clear where the river is flowing.
Tepper: I am not a bull, but I can’t call myself a bear. I have problems with earnings growth and problems with multiples. Take cash off the table.
My Comment: That’s quite a statement from a permabull like David Tepper. If he is starting to turn bearish, it won’t be long before a 10% correction turns into 20….30….40% correction as most bulls begin to sell everything in sight. Most likely at a fairly fast pace.
And as Tepper, I have quite a few problems with growth and multiples. Particularly, that most of the growth (or speculation) has been driven by zero interest rates and QE. All while valuation are at historic bubble level highs. They will come crashing down together, just as they perpetuated each other on the way up.
Tepper: Market should correct, but no one is talking about a crash here. No one knows what that level of correction might be….10-20% corrections should be normal and I would probably be a buyer.
My comment: Maybe they should. That is, talk about the possibility of a crash here. I am certainly talking about it. There were only a few times in our history that we have been as mispriced as we are today. To be exact, in 1929 and 2000 (more so on the Nasdaq). We all know what happened. Why is it impossible to believe that the market readjusts itself in a violent fashion once again? Did you see what has transpired just three weeks ago?
If you have already forgotten, 2.5 years worth of capital gains (on the Dow) were wiped out in 7 trading hours. Beware, this could continue on a much bigger scale.
This conclusion is further supported by my mathematical and timing work. It clearly shows a severe bear market between 2015-2017. In fact, when it starts it will very quickly retrace most of the gains accrued over the last few years. If you would be interested in learning when the bear market of 2015-2017 will start (to the day) and its internal composition, please CLICK HERE.
(***Please Note: A bear market might have started already, I am simply not disclosing this information. Due to my obligations to my Subscribers I am unable to provide you with more exact forecasts. In fact, I am being “Wishy Washy” at best with my FREE daily updates here. If you would be interested in exact forecasts, dates, times and precise daily coverage, please Click Here). Daily Stock Market Update. September 10th, 2015 InvestWithAlex.com
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