Roger Nusbaum submits: Yesterday, in between cruising around, we saw Floyd Landis clinch the Tour de France in the time trial. He overcame huge adversity from the other day when he blew up on one of the mountain stages.
Phil and Paul (the announcers) were giving up on him as being dead in the race. Landis was apparently not phased by this as he just did what he needed to do one stage at a time.
I think there can be a metaphor here for investing. Setbacks in either one stock, your portfolio, the overall market or all of the above are going to happen. No one can control those things but you can control your own actions.
The massive one day lift last week did not convince me, not even close, that I am wrong about being a little defensive these days. In simple terms, demand for equities is, to use John Hussman's words, 'not favorable'.
This does not have to mean a ghastly bear market, but I suppose that is possible - I don't know. I do know that every big move down (excluding crashes and terror attacks) starts with a small move down, a rolling over. The magnitude of the decline so far has been a rolling over of sorts, how most bear markets start. How the month ends could be very constructive in telling us whether a bear market is here, but more on that later.