09-12-2021, 10:08 AM
From the pandemic bottom to now. We see a non stop rally
Anyone who got out and sold only have regrets. Every tiny correct is shallow but sharp and all the pessimists crawling out of the wood work but proven wrong every round for 20 months.
By every measure the US market is expensive ...but that is not a good way to assess whether its time to get out. Soros famously shorted the Nasdaq during dot com bubble thinking it was too crazy high at 3000, the index went up to 6000 forced him out then collapsed to 1400. ...
Where are we today? US markets are offering a mixed bag 3% earnings yield, growth, low interest rates...almost a way to justify a high.
But history tells us there is no economy that never has recessions inflation that necessitate rate increases and the occasional crisis. The existence of these risks is not a good reason to exit from the markets. Because it is inherent in stick investing. But is the advice to "always stay invested" always right?
Saying is like saying we should stay in the 2000 Nasdaq bubble and never get out. There is a point qhere the balance of risk shifts and the market price in so many goof years ahead, it doesn't make sense to hold any more.
The problem is not that markets will go down but how far it goes down depends in the excesses it builds up over time. To say it simply the "higher they climb the harder they fall" and this hard fall is what warrants an exit and foregoing any gains that might come.
With Omicron fears fading and commodities prices falling alloying the fear of inflation temporarily, the US market has all the makings of a parabolic rally that historically marks the end of many bull markets. The tendency towards extreme euphoria is there as bulls defeated so many little corrections they will forget the risks in the market.
My view is this market will surge peak and go nowhere after that as investors struggle to maintain sky high valuations.
![[Image: rxkCEGW.jpg]](https://i.imgur.com/rxkCEGW.jpg)
Anyone who got out and sold only have regrets. Every tiny correct is shallow but sharp and all the pessimists crawling out of the wood work but proven wrong every round for 20 months.
By every measure the US market is expensive ...but that is not a good way to assess whether its time to get out. Soros famously shorted the Nasdaq during dot com bubble thinking it was too crazy high at 3000, the index went up to 6000 forced him out then collapsed to 1400. ...
Where are we today? US markets are offering a mixed bag 3% earnings yield, growth, low interest rates...almost a way to justify a high.
But history tells us there is no economy that never has recessions inflation that necessitate rate increases and the occasional crisis. The existence of these risks is not a good reason to exit from the markets. Because it is inherent in stick investing. But is the advice to "always stay invested" always right?
Saying is like saying we should stay in the 2000 Nasdaq bubble and never get out. There is a point qhere the balance of risk shifts and the market price in so many goof years ahead, it doesn't make sense to hold any more.
The problem is not that markets will go down but how far it goes down depends in the excesses it builds up over time. To say it simply the "higher they climb the harder they fall" and this hard fall is what warrants an exit and foregoing any gains that might come.
With Omicron fears fading and commodities prices falling alloying the fear of inflation temporarily, the US market has all the makings of a parabolic rally that historically marks the end of many bull markets. The tendency towards extreme euphoria is there as bulls defeated so many little corrections they will forget the risks in the market.
My view is this market will surge peak and go nowhere after that as investors struggle to maintain sky high valuations.