The latest from Kneale...

Discussion in 'Wall St. News' started by rickf, Apr 11, 2010.

  1. rickf


    Kneale: The Only Thing We Have to Fear..?

    His observation? Folks are afraid to enter the market and that's a bad thing. The folks who proclaimed doom last year were wrong then, and are wrong now. Fear is why we're seeing higher prices on lower volume. His smugly-justified conclusion? "The best way to build wealth is to bet on hope, searching out the right reasons and the resurgent sectors that can justify it. "

    What is this guy smoking? Hope is not an investment strategy, and at the moment, a rising tide of free and easy money from Uncle Sam indeed has lifted all equity ships...which is why I pretty much am ignoring 2009 results from funds and analyst commentaries at the moment. IMHO the market is so skewed to the upside this past several months it's lunacy.

    Just because the doom-sayers are early with their calls doesn't make them wrong, just early. John Paulson was a year early shorting the CDO markets and got laughed at --- but yet he ended up profiting a dumptruck when the crash came. He laughed at his critics all the way to his bank.

    I am mid-to-long-term bearish and have sat out this equity rally. Do I care? No. There's always another trade, and I do not agree the fundamentals of this economy indeed are as 'strong' or encouraging as many of CNBC's punditocracy believes. As such, I have cash sitting on the sidelines, and have absolutely *no* problem sitting and waiting for the right time to build some long-term positions, because I firmly believe this past year's "rally" is not to be trusted as a sign of fundamental economic recovery.

    I guess that makes me a bad investor according to CNBC's script-readers and cheerleaders. Oh, woe is me. *g*

    my own two cents...

    PS: Since I don't watch CNBC anymore, did anyone notice if they were handing out Dow11K hats on Friday?
  2. The hats AND t-shirts say "Dow 11,000 (again)" :cool:

  3. Could you imagine those funds sitting on cash this whole equity rally after taking a beating in '08? Probably the reason every dip is bought, chasing performance.
  4. lrm21


    Beaker was laughed at for his goldilocks bullishness. I hope he put his money were his mouth was the last year, he should have made more than his salary.

    OP. dont fight the tape. If you sat out this equity rally completely, you have missed the greatest equity rally in the last 80 years.

    At the pace we have crashes, you need to be out the next 1 year 1 year 1/2

    You talk about Paulson, yet has been long for almost a year now.

    The game has been the same since the FED was founded.

    Go Long with the FED, go Short when the FED raises rates, = profit./

    What are your funnymentals for an eminent crash. You dont like the FED transfering wealth from risk averse people to risk takers? If you disagree with that principle you are in the wrong markets. I don't buy stock in Joe Plumber, I buy stock in companies, who are churning out cash right now. Sure the principles suck and its all evil, but better you than me, and all that.

    The day of reckoning will come, just make sure you got yours while the getting is good.
  5. rickf


    (BTW I never mentioned 'imminent crash' --- I said that I don't trust this rally, and to dismiss doomsayers for being early is immature journalism at its best.)

    Yes I mentioned Paulson - he may have gone long, but remember that he's already made his $$$. I haven't. :)

    Indeed, I bought into new long-term (10+ year) positions in late 2008 and early 2009, but have not added to those positions because I don't trust this rally, and have just added stops along the way to protect those surprise rapid gains.

    From what I am hearing, all the institutional buyers are "all-in" right now ... meaning it's Joe Sixpack like us on the sidelines still and who are just now working up the courage to get back into the market.....I daresay at the worst possible time, but that would be me calling a top. :)

    A few other reasons I don't trust this rally:

    Bank earnings, IMHO are a total joke - their profts are due to the inverted yield curve and resulting easy money -- tighten the curve, free money slows, and that profit slows as well. Plus, much of that toxic crap is still on their books.

    Unemployment is still horrible.

    CRE is still horrible, if not worsening.

    People are defaulting on their revisted mortgages. Some doing so repeatedly.

    ... so yes, I may have given up tons of gains, but I didn't fight the tape and start shorting it back in July. No regrets, that's just me investing based on how I see things. I am more than prepared to begin adding to positions and/or starting new ones during the next move down. However, when the time comes, I will still be investing in much smaller lots than usual, which paid off quite well in 2008-early09.

    Yes, the tape still may be climbing, but instead of fighting it or getting on at this point just to "follow the trend" I'll just wait for a more convincing market trend reflective of my longer-term view of the market and longer-term investment horizon.
  6. cstfx


    As CNBC employees, I believe the only stock they were allowed to own outright is (was) GE, the once former owner of NBC networks.
  7. S2007S


    His comments remind me of 1999 and 2007 all over again, once the small investors jumps in its all over. Stocks are up HUNDREDS and HUNDREDS of percent over the last 12 months, do small investors actually believe the market has another 80%-100% upside left, I should hope not. This market is up on liquidity injections and low interest rates. Take that all away and the dow would have never even passed 8000.