I will be on BNN’s “Market Call” Thursday November 5th at 1PM EST.
I will be speaking at the “Montreal Investment Conference” November 6th and 7th
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Things
Posted by
at 6:27 PM on Saturday, October 31st, 2009
You can Play this link for mood background accompaniment as you read Mr. Grandich’s posts. (Click on link, minimize and return to the forum)
http://www.youtube.com/watch?v=qyKm3C1wfJU
Courtesy of SGGroup
No Evidence Of A Downturn
- And –
The Greater Fool Theory
Don’t make too much of chart similarities between the temporary stock market recoveries for the 6 months from late 1929 – Spring 1930 and the current rise from March 2009.
Glancing at Barron’s cover this issue caused me to return here with some troubling thoughts in the back of my mind. The cover page seems to state (I didn’t read the article yet) that the stock market correction will end and go on to new recovery heights until later in the year.
Every market commentator’s opinion seems to state, ” There Is No Evidence That A New Down Trend Has Resumed “. That’s what I was saying last week, and now because it’s all over the Street and on the cover of Barron’s – I’m really worried! It MAY be correct from a technical perspective, “That There Is No Evidence”, but it troubles me that there’s so much company on this side of the fence.
Depending upon how you want to interpret waves patterns from the March 2009 bottom, it’s possible that we may have seen a subtle ‘Fifth Wave’ within what appears to be a ‘Third Wave’. Then again, an A-B-C rise from the bottom may have just finished. Technical indicators could go either way also. I would be concerned if the S&P 500 corrects more than 12% here and particularly if the rebound is lethargic showing signs of rolling over. It’s the rebound that tells the tale.
‘The Tape’ was running pretty good up until the time the market prepared to turn down. True, the DJIA was showing relative strength which is disconcerting, but it was minor and brief. The way that certain indicators are falling suggests it is a correction also. The eventual subsequent rise will hold the clues that we are looking for.
But going back to the chart of the early 1930 partial recovery peak, the renewed decline started without any apparent distribution warning (Sideways movement). They say that ‘Market Sentiment was very bullish at the 1930 peak, and was recently too.
Then there’s something else that troubles me – The Bigger Fool Theory. We are truly blessed if we can see a month or two ahead of the general market and that’s what successful investing might be about. Maybe we’ve been there, received the blessing of vision and failed to act.
How many times have I failed to act, believing that there is a bigger fool out there who can’t see it, failed to act, and ended up becoming a fool myself? They call that missing the top.
I hope everyone’s Halloween wasn’t any scarier than these markets are.
Ron in Vancouver.
Amazing Grace – SG that music was good but I much before this in times like these – now friends don’t yell at me….afterall it is Sunday and by the caption I put on the top here I have given you fair warning what this will be about. The best to all!
http://www.youtube.com/watch?v=Y01rx_XzQ34