Attention Fund Managers: It's Time to Buy

Ouch. These constant daily painful sell-offs are brutal. Negativity in the markets has hit extreme highs, job losses are piling up, and we are 53% below the highs of 14k in the DJIA. There appeared to be no end in sight for the market selling until now: China has announced their stimulus plan. China is spending the equivalent of 724.5 billion dollars in an aggressive stimulus to promote employment, scientific innovation, tax reform, and industrial restructuring.

Although China is not growing their economy at double digits as they have in recent years, they are confident that they can maintain an 8% growth rate with their stimulus policies. I believe that China will lead the world out of this DECESSION, with the United States and then the rest of the world following China's lead.

The U.S. stock market tends to recover six months before the economy recovers.

Therefore, I believe that the stock market will begin a lasting rally within the next few days, expecting that the economy will show improvements by September 2009 and into the 4th quarter. I believe that the U.S. government will continue to fine-tune our stimulus plan and find the right sparks to light-up our economy.

I am calling on all those big market movers out there: the hedge fund and mutual fund managers to cover your short positions and start your long positions now. Get that cash off of the sidelines and into some great valued stocks. Let's start moving this market upward as our economies recover, leading to a stronger nation and world.

Comments

[peterthepai...:]

yo dave!...good luck with that...

Mar 06 05:22 AM

[The Too Sma...:]

Don't wait for $VIX to go high for that capitulation. It won't happen. March 2003 market bottom saw a low $VIX compared to the October 2002 low. Captiulation is happening at this monent as many stocks going nose dives.

Mar 06 08:53 AM

[Tomcat101:]

I somehow doubt all the fund managers are keying up there orders because you told them it was allright now.

I hope you're right though.

Mar 06 09:05 AM

[ali k:]

David - in all fairness - markets don't move up and down based on how you BELIEVE they will. We're at some awfully terrible lows, but we have no reason to believe this is the bottom! No sector in the globe has seen their bottom. "I believe the stock market rally in the next few days"?? Based on what? Without some numbers, figures, statistical evidence, even qualitative hard evidence, this is just speculation.

Mar 06 09:11 AM

[McSam:]

Chearleaders rule! Rah! Rah! Rah! You go girl.

Mar 06 09:45 AM

[axelrod608:]

"50% below the high" is not a sure sign of opportunity. It is only a number. Ask yourself this - how inflated was that high ? Was it just a normal spike of overexuberance or was it a totally demented bubble ? I think it was the latter. And looking at the financial landscape rather than the numbers, I see a whole lot more downside to come.

The US automakers are toast. Commercial real estate is toast. The insurance industry which is heavily invested in commercial property is starting to look shaky.

Buy now ? Only if you can afford to lose another 50%.

Mar 06 11:50 AM

[David Zanoni:]

I knew that I was going to get a lot of criticism for this article, but I am agreeing with Doug Kass who on Monday said that the market would hit bottom this week. Mr. Kass even confirmed his call earlier today. The idea is that there shouldn't be any more surprises. We know that the automakers & financial institutions are hanging by a thread, we know that the job prospects are bleak right now and that the economy is in the dump The market has reflected that for over a year now. OK, so maybe we won't have a strong rally right away, but it is likely that we may crawl along the bottom without going significantly lower which would make for a great time to carefully select some valued companies that will emerge stronger.

Mar 06 02:15 PM

[OldLimey:]

Doug Kass also said that November was the bottom.


On Mar 06 02:15 PM User 371238 wrote:

> I knew that I was going to get a lot of criticism for this article,
> but I am agreeing with Doug Kass who on Monday said that the market
> would hit bottom this week. Mr. Kass even confirmed his call earlier
> today. The idea is that there shouldn't be any more surprises. We
> know that the automakers & financial institutions are hanging
> by a thread, we know that the job prospects are bleak right now and
> that the economy is in the dump The market has reflected that for
> over a year now. OK, so maybe we won't have a strong rally right
> away, but it is likely that we may crawl along the bottom without
> going significantly lower which would make for a great time to carefully
> select some valued companies that will emerge stronger.

Mar 06 02:39 PM

[Portfolio M...:]

Kass said that November was the bottom FOR 2008. He was right. He seems to be right a lot.


On Mar 06 02:39 PM OldLimey wrote:

> Doug Kass also said that November was the bottom.

Mar 16 11:49 AM

[David Zanoni:]

It's been almost 3 months after this article was written and it looks like the author was correct. All of you doom and gloomers who piled on the criticism made the market's bottom happen. Thank You.

May 27 09:11 PM