Fri, Jul 9, 2010, 2:58PM EDT - U.S. Markets close in 1 hr 2 mins
The bulls have pushed aside the bears on Wall Street -- for now. Signs of optimism following three consecutive winning days in the stock market have replaced the doom and gloom mood so prevalent in the two prior weeks.
Having already heard the bullish case from Doug Kass and James Paulsen earlier this week, Tech Ticker decided to invite Mike "Mish" Shedlock, author of Mish's Global Economic Trend Analysis, back on the show to hear the other side of the argument.
Is he bearish? You bet!
"The optimism out there is rather insane," he says. There's only a 15-20% chance of the market rallying, Mish tells guest host and Business Insider deputy editor Joseph Weisenthal. "It's more likely we go down there and test the March lows, and there's a decent chance actually that we break those lows," he says.
Mish says "it is nuts to be net long" stocks right now in the face of all these headwinds:
-- Slowdown in Europe as austerity measures take hold.
-- Slowdown in U.S. as stimulus fades, housing remains weak, state and local governments cutback
-- China looks to cool its economy in the face of growing housing bubble
Until Mish sees signs of sustainable job growth, he'll be firm in his bearish stance. "Without a driver for jobs I don't know how someone could be bullish on the stock market."
If not stocks, then what?
Mish is sticking with what's worked this year: Treasuries and gold. Treasury yields are still near record lows, but he think with the macroeconomy the way it is, it's very possible, "the bull market in Treasuries is not over." As for gold, he'd buy on the dips.
___ Follow Yahoo! Finance on Twitter; become a fan on Facebook.
Good guest. He defended his bearish position with very valid arguments.
Shoulda coulda woulda but I wouldn't.
I'm 100% out of stocks. You can't fight the cycle. Realestate drove our economy up and now it will drag it down. We also are fighting an anti business/big Gov administration. Hang on.
JDAM wrong simply put the tax rates for the extremely wealthy were dropped in the 70's by Kennedy and then again in the 80's by Regean, both cuts were substantial for the very wealthy, the top rate is currently 35% going to 39 a boon to the super rich YES math fact etc. THEY got the tax cut you and I got the shaft
The truth from above article, but how many hard head listen, they all believe for short gain but blind side of free falling there is the only thing can tell is the time to find out who is hurting when the free falling begin. I believe the bear is showing up very soon and it will hurt so many people now aday. Keep working beyond the 65, 70, 75, or ???
Mish is an obvious trader; not an investor. Slow, steady growth is a formula for long term investors to grow their portfolio. Don't listen to those on the extreme; they make their money off of volatility.
Bring the Octopus on the show. It didn't even hesitate.
Bring the Octopus on the show to predict stocks. It didn't even hesitate.
After listening to these "experts" I think the best investment option is to hide my money under my mattress.
Nothing has been fixed. Stimulus was borrowed from the future. Debt was the problem to begin with and we have more of it now. Borrowing and spending does not make a recovery. Soon interest payments on debt will be enough to kill any recovery as you know it. Deflationary crash is coming. Individuals, state, local, federal governmers will not have disposable income left to spend. This is the mother of all crashes. 2008 was just the warmup. Stocks are at bubble prices. Yet everybody wants to own them! Back in March 2009 nobody wanted stocks. At that time only 3% of traders were bullish. That is how the crowd gets it wrong! That meant a fuel of 97% of traders to turn to the bullish side and drive the stocks higher. Fast forward to April 2010, 92%+ of traders were bullish and thought stocks would go ever higher and they would sell to the greater fool. Only the contrarians will sell at the top and buy at the bottom! http://www.tradingstocks.net/html/latest_opinion.html
Bring the Octopus on the show to predict stocks. It didn't even hesitate.
Give me 1 billionaire outsider who can hire his own merks for protection, unlimited TV commercial/Media budget and INDEPENDENT status, and I could make him President in 2012. The American Public is 10 times more angry than in 1992 with Ross Perot who got 20% share. Quite amazing that Perot was right on that giant "sucking sound". Skull & Bones boy became President.
Also, I guess Mish prefers to ignore the incredible turn in the Hulbert Survey where the recommendation of advisors plummeted AFTER the 274 point day. Does that sound like insane optimism? Mish, take off your blinders and while you are at it, take them off Mr. $200 gold Prechter. http://www.marketwatch.com/story/bounce-leaves-bears-bulls-entrenched-2010-07-08?reflink=MW_news_stmp
Correction: State sponsored optimism. Now go out and shop!
Hey, don't listen to anybody who tries to give you the real story. Just stay in your little white bread world and keep clicking your heels together and say after me. " its all good- its all good- its all good. Priceless, just damn priceless
Its like Rome just before its fall. Pay off all debts, have cash, gold. Judgment day is near.
STAY IN CASH...........HE IS PROBABLY RIGHT.............
Nothing wrong with shorting rallies now... will be interesting to see how earnings season plays....
A slowdown is not a recession...2-3.5% growth is still growth. How do you test 6,500 without a technical recession?? Treasuries?? You are paid to make money not break even...You're investors lose 2% (management fee) for breaking even... I'll listen to Goldman and keep my money in the market for the long haul and wait out the bumps in the road.
You cannot hold anything in this market because it is very likely that we will be down for the next 10 years. We have already been down since 2000.This guy is right on.
Quotes and other information supplied by independent providers identified on the Yahoo! Finance partner page. Quotes are updated automatically, but will be turned off after 25 minutes of inactivity. Quotes are delayed at least 15 minutes for NASDAQ, NYSE and Amex. See also delay times for other exchanges. Real-Time continuous streaming quotes are available through our premium service. You may turn streaming quotes on or off. Fundamental company data provided by Capital IQ. Financials data provided by Edgar Online. Historical chart data and daily updates provided by Commodity Systems, Inc. (CSI). International historical chart data, daily updates, fund summary, fund performance, dividend data and Morningstar Index data provided by Morningstar, Inc. Analyst estimates data provided by Thomson Financial Network. All data provided by Thomson Financial Network is based solely upon research information provided by third party analysts. Yahoo! has not reviewed, and in no way endorses the validity of such data. Yahoo! and ThomsonFN shall not be liable for any actions taken in reliance thereon. All information provided "as is" for informational purposes only, not intended for trading purposes or advice. Neither Yahoo! nor any of independent providers is liable for any informational errors, incompleteness, or delays, or for any actions taken in reliance on information contained herein. By accessing the Yahoo! site, you agree not to redistribute the information found therein.
Read Full Article »