David Weidner, Lombard Odier, Jim Willie, & Dennis Gartman: Dow 6,300? Watch Out! Reversal of the ‘Great Rotation’ Coming. The Collapse Is At Our Doorstep! I’m Concerned About All The Insider Selling And The Lack of Volume On The Upside
…Today, many investors are still on the sidelines. They’ve been burned by the dot-com boom and bust, the housing boom and bust, and multiple boom and busts. Glassman calls these and other market-shaking events “black swans.” But a black swan by definition is surprising and transformational. It doesn’t occur multiple times in a decade. What occurs every few years? Market ups and downs.
Glassman’s better argument is that stocks are undervalued especially in an environment when bonds such as the 10-year Treasury are paying 2% or less. He also points out that Microsoft Corp. (NASDAQ:MSFT) and Intel Corp.(NASDAQ:INTC) are actually valued less than they were at the 2002 bottom. It’s true they may not be growing as fast, Glassman said, but they have more cash and pay more dividends.
The problem with this view is that a few undervalued slow-growing tech companies hardly justify such lofty heights for the Dow 30. They don’t suggest 36,000 or even 23,000.
In fact, an argument could be made that Dow 6,300 is just as likely. After all, we spent much of the last 13 years since Glassman and Hassett’s book came out closer to the lower end of that range….
Talk of a “great rotation” out of bonds and into equities is misleading according to investment strategy group Lombard Odier, which argues that 2013 could see the reverse happen.
Global equity markets have thrived on the back of increased risk appetite since the start of the year, with major indices including the Wall Street’s Dow Jones Industrial Average and Tokyo’s Nikkei 225, breaching multi-year highs in recent weeks.
Meanwhile traditional safe haven investments have sold off. Benchmark 10-year Treasury yields have climbed over 50 basis points since the start of the year to over 2 percent.
But Geneva-headquartered Lombard Odier says in its latest Investment Strategy Bulletin that investors should not get too comfortable with the current rally in equities.
(Read More: The Great Rotation: A Flight to Equities in 2013)
“A theme for 2013 might well actually be the rotation out of equities and back into bonds,” Lombard Odier writes in the report.
S&P 500: Analysts cite triple-dip risk
The Golden Jackass Jim Willie sat down with The Doc this weekend for the second part of an extraordinary interview regarding gold, silver, and what Willie believes will soon be a massive European banking collapse.
Willie states that a global financial collapse is now at our doorstep, and that the endgame will be triggered by a small-medium sized bank failure in Europe.
Willie informs SD readers that the coming European bust will ignite a global Gold rush as the only remaining safe haven, will see an end to the reserve status of the USdollar, and will result in the arrival of the Gold Trade Finance platforms.
Willie also discusses The Fed’s futile attempts to re-inflate the housing bubble, and the series of climax events that will bring a breath-taking global financial collapse to our doorstep!
The Golden Jackass states that the coming collapse will devastate everyone in the West except those who are bold enough and brave enough to buy gold & silver NOW!
“I was wrong 3 percent”.
Now stocks have been hitting all-time highs.
In an interview with CNBC, Gartman said he was wrong on stocks, “wrong 3 percent”, but that he’s going to stay on the sidelines.
In his latest note, he explains why he is sticking to his decision to stand down:
“We are, and we have been, concerned about insider selling; we are and we have been concerned about the rising level of confidence in a steadily rising equity market amongst those who were only a few weeks ago were convinced of the same markets inherent weakness; we are and we have been concerned about the lack of volume on the upside and these concerns seem not to go away.
Staring Armageddon in the Face But Hiding It With Official Lies
According to the Bureau of Labor Statistics, the US economy created 236,000 new jobs in February. If you believe that, I have a bridge in Brooklyn that I’ll let you have at a good price.
Where are these alleged jobs? The BLS says 48,000 were created in construction. That is possible, considering that revenue-starved real estate developers are misreading the housing situation.
Then there are 23,700 new jobs in retail trade, which is hard to believe considering the absence of consumer income growth and the empty parking lots at shopping malls.