I hope you are having a great day. Here's what we're reading tonight.
- Bull market's five-year anniversary, in five charts - WSJ
- Merkel eye for Russian Empress shows Putin ties are complex - Bloomberg
- Obama budget predicts strongest U.S. growth since 2005 - Bloomberg
- RadioShack's woes: dead brand walking - Economist
- Falcons in the gyre, or something. A second coming and how Pimco works - Alphaville
- Warren Buffett
The above quote is strategically placed - by way of PostIt note - right next to my monitors. And when we have days like yesterday, I am quite pleased with its placement.
After yesterday's all-day selling pressure, brought on by Mr. Putin's military "exercise" (a.k.a. invasion) in Ukraine, the S&P 500 raced to new highs today (on volume). Monday proved to be a buy-one-get-one-like sale for the nimble. The closing print on the SPX was 1,873, while the Dow and Nasdaq (largest percentage gainer at +1.75%) finished at 16,395 and 4,351, respectively.
It is nearly impossible to accurately gauge where markets might end up months or years into the future. Even in the near-term, it is a challenging task - especially if you have skin in the game. All one can do is formulate an idea on where the odds lie, and attempt to trade with those odds.
With that said, Jeffrey Kleintop of LPL Financial has made some bold predictions. Borrowing from the article above, "Bull market's five year - you get the idea - I have posted a couple charts Mr. Kleintop provided the WSJ.
Keep in mind, the only thing that separated 2008-2013 from looking more like 1929-1934 was an incredibly different (and much more accurate) approach to monetary policy. If you see Hank Paulson, make sure you pat him on the back and give him a heartfelt "'atta boy!"
So, since the end of WWII, the current bull market is the second strongest on record. Again, this seems absolutely nuts unless one understands how truly awful 2008-2009 really was. Note that the strongest bull market since WWII ended with the crash of 1987. Hmmm...
This chart is the interesting one (I wish it went back to net inflows pre-2009). The retail money - to be kind - has not participated in this rally. The halved 401(k)s and delayed retirements brought on by 2008-2009 still resonate with many "mom and pop" investors. With that said, persistently low rates are causing some to go on the hunt for returns again.
If nothing else (because it certainly isn't consistently profitable), prognosticating is fun. Retail money is getting close (if not on it already) to the "buy" button. Everyone knows what happens next.
Heads, this time is different. Tails, this time is never different.
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