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Eric Parnell, CFA  

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  • Gold Is In A Bull Market And Stocks Are In A Bear Market [View article]
    Hello whowho77,

    Thanks for your comment. I appreciate it. And you raise the excellent counterpoint to the stock/gold secular debate, which is the possibility that the secular bear market in stocks and secular bull market in gold ended in March 2009. This is definitely a possibility and only time will tell if this is indeed the case. But a secular market cycle at roughly 9 years would be very short by historical standards. Moreover, stocks have typically arrived at the end of secular bear markets following three major corrections and with valuations that have fallen into the 5x to 12x earnings range. To date, we have only seen two major corrections and valuations were never allowed to fall to this level thanks in part to the policy support provided in recent years. But with that said, the last few years have shown that new historical precedents are being created with each passing year.

    Great points. Thanks again!
    Feb 6, 2015. 11:21 AM | 1 Like Like |Link to Comment
  • Gold Is In A Bull Market And Stocks Are In A Bear Market [View article]
    Hello cfetrader,

    Thanks for your comment and for sharing these charts. These are very informative. And your point about central bank action is also excellent, as this remains one of the most important points to watch as we move forward in today's markets.

    Thanks again!
    Feb 6, 2015. 06:22 AM | 1 Like Like |Link to Comment
  • Gold Is In A Bull Market And Stocks Are In A Bear Market [View article]
    Hello Thomas,

    Thanks for your comment. You raise some excellent points here. I agree that central banks remain bullish for stocks despite the Fed stepping away. Central bank action remains as the primary downside risk for anyone that is bearish on stocks, and these are risks that cannot be overstated for those that are even considering shorting stocks right now.

    As for the impact of these QE programs, U.S. stocks have been flat since December 18 when the final asset purchases came through the system from the Fed's QE3 program. And while Japan continues to purchase assets, the net impact of the program both on U.S. and Japanese stocks has been largely neutral to this point over the course of the program (not unlike the influences of Operation Twist I and II out of the U.S. a few years back).

    As for central banks buying stocks, this is an important point worth monitoring, although it is notable that the Bank of Japan has been both using QE and buying stocks for years with mixed results at best. In the end, just as Treasury purchases by the Fed did not necessarily lead to rising Treasury prices, central bank stock purchases only help at the margin. For if private investors decide to reallocate capital elsewhere, there's only so much demand that central banks can create to offset this change in the tides.

    These are all great points that are worth monitoring going forward. Thanks again.
    Feb 6, 2015. 06:20 AM | 1 Like Like |Link to Comment
  • Gold Is In A Bull Market And Stocks Are In A Bear Market [View article]
    Hello Alex,

    Thanks for your comment and for your perspective. I think you make a number of good points here including your conclusion, as another major leg lower is very possible before it's all said and done.

    While he has been gone from SA over the last few months, Avi Gilburt continues to do good work in tracking the precious metals. The following is a link from Tuesday for those that are interested.

    http://on.mktw.net/16E...

    Thanks again.
    Feb 6, 2015. 06:13 AM | 1 Like Like |Link to Comment
  • Gold Is In A Bull Market And Stocks Are In A Bear Market [View article]
    Hello Arthur,

    Thanks for your comment and for sharing your perspective and strategy in the current market. I appreciate it. And I do not disagree that stocks have the potential to continue to rise in the months and years ahead. But given that current valuations largely discount much of the economic growth we are likely to see in the coming quarters, it is my view that the risk-reward profile for stocks are more neutral and even biased to the downside looking ahead over the next couple of years. Of course, central bank action going forward will play a big part in the final outcome. It will be interesting to see.

    Thanks again.
    Feb 6, 2015. 05:29 AM | 4 Likes Like |Link to Comment
  • Gold Is In A Bull Market And Stocks Are In A Bear Market [View article]
    Hello mkemac,

    Thanks for your comment. I appreciate your perspective, but I always think it is notable how so many investors have scorn for gold. Given that so many asset classes exists that offer an attractive potential rate of return over time, I would actually contend that stocks get so much more disproportionate coverage relative to everything else. It's not that I don't like stocks. In fact, it is my favorite asset class. But incorporating a view on all asset classes can be very useful from an information standpoint.

    Thanks again for your perspective. I appreciate it.
    Feb 6, 2015. 05:26 AM | 4 Likes Like |Link to Comment
  • Gold Is In A Bull Market And Stocks Are In A Bear Market [View article]
    Hello Strike,

    Thanks for your comment. I appreciate it, as it actually proves the point that I was trying to make with the article, as I would contend that you are right with your points just as I continue to stand by my own conclusions. It's not a matter of one needing to have their eyes tested, but instead opening themselves up to see different vantage points on a capital marketplace that becomes far too dominated by near-term thinking and extrapolating the trends of the last few years forward.

    And you are right that all of these stock markets are higher on a nominal basis, but given that we are theoretically investing our money in order to at least maintain our long-term purchasing power, I would contend that outperforming inflation and focusing on real returns is more important. And by the DJIA, Russell and S&P measures that you've cited here, gold is up +384% since 2000 on a nominal basis over the same time period, which gets to my point about why it is in a bull market while stocks are in a bear market.

    My intent with this article is not to bash stocks and promote gold. Instead, it is to observe that both go through extended secular phases that tend to trend opposite of one another and since 2000 the forces continue to favor gold. With that said, perhaps we are at the beginning of a new secular phase, but history suggests that this is unlikely. It will be interesting to see.

    Thanks again for your comment.
    Feb 6, 2015. 05:22 AM | 6 Likes Like |Link to Comment
  • Gold Is In A Bull Market And Stocks Are In A Bear Market [View article]
    Hello Michael,

    Thanks as always for your comment and thanks for sharing your latest Instablog post. I agree that gold has not yet bottomed. Perhaps sometime over the next few months as it appears to have rolled over from recent highs and is prepared to once again test the $1130 to $1180 range. New lows also would not be a surprise, as a stronger dollar and a Fed that seems eager to notch a few rate hikes this year is bearish for gold in the short-term, although it is notable that the dollar and gold have been moving with positive correlation so far in 2015. It will be interesting to see how it all plays out, but in the meantime I remain on the sidelines with any gold allocation.

    Thanks again Michael. Hope you are doing well.
    Feb 6, 2015. 05:10 AM | 3 Likes Like |Link to Comment
  • Time To Consider Regional Banks [View article]
    Hello Seth,

    Thanks for your comment. Just to confirm, is this FNB Bancorp out in the San Francisco area or FNB Corporation out north of Pittsburgh near Youngstown, OH? Interested to take a look.

    Thanks again.
    Feb 2, 2015. 03:14 PM | Likes Like |Link to Comment
  • Time To Consider Regional Banks [View article]
    Thanks Matthew - I appreciate it. What names in particular are you finding interesting? Thanks again.
    Feb 2, 2015. 03:11 PM | 1 Like Like |Link to Comment
  • The Bull In Winter [View article]
    Hello cfetrader,

    Thanks for this great comment and extensive chart set. I appreciate your sharing this information on this article and I look forward to exploring this chart listing based on your recommendations. Excellent information.

    Thanks again
    Feb 1, 2015. 05:41 AM | 1 Like Like |Link to Comment
  • The Bull In Winter [View article]
    Hello Rseye - Thanks for your comment. As for the US dollar, while recent bear markets have been generally dollar bullish, the recent spike in the dollar may have already discounted some of this move. I expect increased global currency volatility as well along the way too.

    Thanks again!
    Feb 1, 2015. 05:40 AM | Likes Like |Link to Comment
  • The Black Cloud Still Looms Large [View article]
    Hello Alex,

    Thanks for your comment and I agree. Assets will be on sale for those that have the cash to put to work at the end of the day. But to your point, I do not think we are close to fire sale prices at this time. Perhaps later in 2015 depending on how much lower oil prices go and how long they stay there. It should be interesting to see.

    Thanks again.
    Jan 28, 2015. 01:57 PM | 2 Likes Like |Link to Comment
  • The Black Cloud Still Looms Large [View article]
    Thanks vieroman - I appreciate it!
    Jan 28, 2015. 01:23 PM | 1 Like Like |Link to Comment
  • What U.S. Investors Can Expect From ECB QE [View article]
    Hello creese,

    Thanks again for your comment and for these follow up points. I think your first point makes good sense, but I wonder whether QE will end up fostering even more social unrest in the end. For to your second point, we are increasingly living in a world of oligarchs and QE has greatly contributed to the ultra rich becoming richer while the rest of the global economy languishes. This, of course, leads to your third point, which I think makes a lot of sense, as backing off on austerity and providing the room for more stimulus is a different path that has the potential to provide more fiscal policy flexibility. Whether policy makers actually capitalize with constructive policies remains to be seen.

    Excellent points as usual. Thanks again.
    Jan 25, 2015. 08:34 AM | Likes Like |Link to Comment
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