10 Reasons to Be Bullish on Stocks

I buy all but one of Bob Doll's ten reasons to be bullish on stocks. The only clunker: "9. Technical factors have also improved since March 17, including the fact that up-day volume has been heavier than down-day volume." Please, no chart-reading...

Also modestly iffy: "10. The earnings yields of equities compared with 10-year Treasuries are at their best level in 30 years." Maybe! Except that the relationship between the earnings yield and the yield on the 10-year note seems to hold up a lot better in theory than it does in real life.

Maybe Doll felt like he had to get the list into double-digits to make it persuasive...

Comments

[John Pseudonym:]

He forgot these:

1. Highest inflation rate in 33 years.

2. FDIC is bracing for ~200 bank failures this year.

3. World food shortages leading to riots.

4. Stock market in denial.

2008 Apr 15 05:04 PM

[John Pseudonym:]

"Bob Doll, the firm's global chief investment officer for equities"

"U.S. investment fund with some $1.36 trillion in assets under management"

Sounds like he needs 10 reasons to lure suckers to the market so he can back out of his positions without having his head handed to him in a paper bag.

2008 Apr 15 05:07 PM

[Bespoke Bul...:]

Mr. Stichnoth shows not even the slightest doubt in his mind about the bullishness of stocks. Unfortunately there are way too many like him out there, with the same conviction and that try to pick bottoms every time the market dips. As long as these people are out there, propping up stocks and chasing bottoms, we will not see the real bottom for a while.
What I hate the most about perma bulls is their absolute conviction in the long term direction of the stock market. Until they are smacked down hard, like they were in 2001 or until a Japan comes along, which has been in a bear/sideways market for the last 18 years. It's just goes to show you that we never learn from the past.
Amazing really.

2008 Apr 15 05:07 PM

[zenalgorithm:]

Consumer is staying at home because he can't afford gas to get to the stores, and because his house has negative equity - he can't take out a new loan to buy more junk. American home and equity assets are still 15-20% over-valued. We have another big leg down coming this summer.

2008 Apr 15 05:42 PM

[Trader T:]

Bear market rally's - sell into the irrational glee.

2008 Apr 15 08:42 PM

[User 143167:]

It is amazing that all of his 10 reasons are speculations, but NO facts.

2008 Apr 15 10:07 PM

[globalmacro:]

It's also amazing that no real bear market ever started with this much pessimism. Show me a board anywhere on the web thats any less pessimistic right now. Bring on the next bull market.

2008 Apr 15 10:36 PM

[User 143167:]

If 20% off from all time high makes it, Bear markets are across the globe except the US who actually produces the mess. This is what's really AMAZING.
Doesn't really matter we're trading at the one of the highest PEs in the world! Nothing really matters as we've hit the technical bottom on the charts!

2008 Apr 15 10:44 PM

[globalmacro:]

11. GOOOOOOOOOOOOOOOGLE!!!

2008 Apr 17 08:54 PM