Seeking Alpha

Eric Parnell, CFA

 
View as an RSS Feed
View Eric Parnell, CFA's Comments BY TICKER:
Latest  |  Highest rated
  • A Once In A Generation Change For Stocks [View article]
    Hello permanent,

    Thanks for your comment and good point. As they have in the past when QE has come to an end, Treasuries continue to perform well. I believe persistent uncertainty about the global economic outlook and the capital inflows from safety seeking investors that more than offset the loss of demand from Fed purchases are continuing to provide support to the Treasury market. It will be interesting to see if this trend continues post QE3.

    Thanks again.
    Oct 30, 2014. 01:23 PM | 2 Likes Like |Link to Comment
  • A Once In A Generation Change For Stocks [View article]
    Hello Khyber Pass,

    Thanks for your comment and I share your interest in seeing a financial system that would return to some semblance of normality following several years of market distorting stimulus programs. Hopefully this will come to pass sooner rather than later.

    Thanks again
    Oct 30, 2014. 01:21 PM | 4 Likes Like |Link to Comment
  • Stocks And Seasonality: Caveat Emptor [View article]
    Hello rz2013 - Thanks for your comment. I appreciate it!
    Oct 29, 2014. 12:39 PM | Likes Like |Link to Comment
  • Stocks And Seasonality: Caveat Emptor [View article]
    Hello Joefed,

    Thanks for your comment and for sharing your thoughts. I refer to Bullard's jawboning as effectively QE4 since QE3 will have officially come to an end as of this past Monday. Of course, if the Fed did announce today that they were continuing asset purchases into November, you would be right that this would technically represent a continuation of QE3. So your point is well taken.

    Thanks again for raising a challenge to this issue.
    Oct 29, 2014. 12:38 PM | Likes Like |Link to Comment
  • Stocks And Seasonality: Caveat Emptor [View article]
    Hello Alan,

    Thanks as always for your comment. Your perspectives are always appreciated. I think you are right that the Fed will now rely on dangling the QE carrot whenever times get tough for the markets in the coming months now that QE3 is finished. The fact that it worked particularly well during this last correction will likely only increase their confidence in this verbal approach. Draghi has been successful with it for some time now and it will be interesting to see how long the Fed can get away with it too.

    Thanks again. Hope you are doing well.
    Oct 29, 2014. 12:36 PM | 1 Like Like |Link to Comment
  • Stocks And Seasonality: Caveat Emptor [View article]
    Hello cfetrader and Ted,

    Thanks to you both for your comments. These are excellent points, particularly about trying to capture the final few percentage points to the upside if we are indeed approaching a market peak. My allocation specifically to high beta stocks, which tends to sell off first in the early stages of the transition between a bull market peak and the start of a bear market and were absolutely routed during the recent correction, is less than 3% of total portfolio value at this point and will likely be dialed to 0% in the near-term for this very reason.

    Great points and thanks again.
    Oct 29, 2014. 12:33 PM | 1 Like Like |Link to Comment
  • Victory For The Bears [View article]
    Hello bbro,

    Thanks as always for your comment and for sharing your insights.

    I would not go so far as to say either of us are wrong, but instead would say that we agree to disagree.

    As for your link, this is great from a positive economics perspective, but the bigger question is what it might be missing from a normative perspective, particularly as it relates to financial markets and valuations.

    On a different topic, gathering from a recent comment that you are a University of Texas football fan, what is your opinion of Charlie Strong?

    Thanks again for your comment. I always appreciate reading your views.
    Oct 25, 2014. 06:36 PM | 7 Likes Like |Link to Comment
  • Stocks: The Most Important Week In 6 Years [View article]
    Hello Ted,

    Thanks as always for your comment and your excellent points as always. I agreed with your recent comment about the risk-reward being heavily tilted to the downside at this stage (not worth trying to squeeze out the last +3% to the upside), and your point here is also very important about the leadership of defensive sectors at bull market peaks into the early stages of bear markets, as these are the areas that have traditionally provided positive returns for some time even as the broader market had fallen into a bear market. The same set up has been playing out recently, as high beta and momentum has been badly slammed in this latest pullback.

    Your point about investors getting unwittingly trapped in bear markets is also outstanding and something that I agree with completely. I see this as a particular risk in the current bull market given that investors have become so conditioned to buy every and all dips over the last six years. Unfortunately, this dip buying is exactly how investors suddenly find themselves down -20% to -30% before they realize that the bear market has been underway for some time and is set to continue for a while longer.

    Outstanding points as always. Thanks again.
    Oct 12, 2014. 02:24 PM | Likes Like |Link to Comment
  • Stocks: The Most Important Week In 6 Years [View article]
    Hello Shoemouse,

    Thanks for your comment and great points as usual. One that particularly stands out for me is your point about pizza and stocks. It is one of the amazing things about stock investing, as they are among the rare few items that people demand less of when they are on sale at low prices and demand more of when they are marked up at high prices.

    From my perspective, I like sales far more than mark ups. I still remember that flight to Cleveland on March 12, 2003 when I had run and printed a individual stock screen for all of the names in the S&P 1500 at the time - there was so much value on the pages that I regretted not having nearly enough capital to buy up the hundreds of individual names that were on sale. I look forward to such a day again sometime in the future if it ever allowed to come to pass.

    Thanks again for your great comment.
    Oct 12, 2014. 02:16 PM | 1 Like Like |Link to Comment
  • Stocks: The Most Important Week In 6 Years [View article]
    Hello Retired1,

    Thanks for your comment and great questions. My take is the following. If we do get a bounce, it may be fairly weak. And even if its strong enough to take us to new highs, they may very well be the final highs of the long running bull market. After that, I believe the onset of the next bear market is drawing close and could be upon us within the next few months if not sooner. How things play out in the coming week will be important in determining exactly when this transition finally takes place.

    Well done on the TZA position over the last three weeks, as it has been tremendously rewarding over this time period. Great call so far.

    Thanks again for your comment and great questions.
    Oct 12, 2014. 02:10 PM | 1 Like Like |Link to Comment
  • Stocks: The Most Important Week In 6 Years [View article]
    Hello BBwetrust,

    Thanks for your comment. While my article suggests a probability tilt in favor of a bounce in the coming week (Monday in particular will be interesting given the light volume that typically comes with the Columbus Day holiday), the probabilities are generally balanced between such an outcome and the continuation of the move lower. My answer here sounds kind of wishy-washy, but the fact that we are at a major market crossroads with so many other things already happening is what makes the upcoming trading week so important in choosing the path for the weeks and months ahead. It will be interesting to see.

    Thanks again for your comment. I appreciate it.
    Oct 12, 2014. 02:07 PM | 1 Like Like |Link to Comment
  • Stocks: The Most Important Week In 6 Years [View article]
    Hello jprizzuto,

    Thanks for your comment and for raising some good issues for discussion. Your point is well taken about the 'either/or' nature of recent articles. One of the things that I dislike about a market where short-term probabilities are more balanced between two outcomes is that it can cause my articles to come across like I am waffling, which is not my intent. Instead, it is more to express that things could go either way at the current juncture, but I can definitely see where it might come across otherwise.

    As for my intermediate-term outlook, I would narrow my range of predictions from what you described to the following. Either the market rallies from here and the bull market lasts a few months longer before ending (no happily ever after - instead a happy for a just little while longer before the fun comes to an end), or it breaks down from here and the bull market ends sooner rather than later (not an end of a world scenario by any means but instead a long overdue cleansing that finally allows the economy and markets to evolve to the beginning of the next secular bull market phase, which in my opinion is the better of the two outcomes of not prolonging the inevitable to get to a far greater future positive).

    In this regard, I think we are largely on the same page with the exception that I believe we are still in the midst of a secular bear market and that the coming bear market may last longer and go deeper in order to bring us to the start of the next secular bull market. It will be interesting to see how it all plays out.

    Thanks again for your comment. Great points!
    Oct 12, 2014. 02:01 PM | 2 Likes Like |Link to Comment
  • Stocks: The Most Important Week In 6 Years [View article]
    Hello GeeZee,

    Thanks for your comment and I agree with your point here about the various other asset classes that have already broken down. I have actually covered these points in detail in a number of recent articles, so I opted to reduce my revisiting of this point to the first paragraph on the bearish side so as to avoid beating the point into the ground. But I agree with you point and appreciate your raising it. And to your point, even if the market does rally from here, it very well may be the final waning advances before this long running bull market finally gives over to the next bear.

    Excellent points and thanks again for raising them for emphasis.
    Oct 12, 2014. 01:53 PM | Likes Like |Link to Comment
  • Stocks: The Most Important Week In 6 Years [View article]
    Hello duster,

    Thanks for your comment and you hit squarely on one of my many laments about the persistently easy monetary policy from the Fed over the last several years. By driving so many asset classes to premium valuations, they have created a far more unstable long-term investing environment and undermined the ability to effectively diversify through asset allocation while at the same time eliminating the ability for retirees and those living on a fixed income to secure a reasonable interest rate from FDIC insured savings instruments. Clearly, investors will likely have to work much harder and be much more nimble in the future than they might have had to be otherwise if the Fed had simply backed off in the summer of 2010 instead of diving back in for QE2, two Operation Twists and QE3. It should be an interesting rest of the decade in this regard.

    Thanks again.
    Oct 12, 2014. 01:49 PM | 1 Like Like |Link to Comment
  • Stocks: The Most Important Week In 6 Years [View article]
    Hello tallguyz,

    Thanks for your comment and your kind words on my articles. I appreciate it!

    You raise a very good point about cash. Your timing in moving to cash has worked particularly well, which is great.

    I find that holding cash is often underrated and overlooked as an alternative for investors. Holding cash does not mean that one has to keep it there forever earning +0.05% interest. Instead, holding cash for the short-term or intermediate-term earning +0.05% is a far better alternative than suffering a -20% decline in value. Moreover, an allocation to cash within a broader asset allocation strategy can help neutralize overall portfolio volatility, which can be a plus particularly during periods of heightened uncertainty.

    Thanks again for your comment and for sharing your current thinking.
    Oct 12, 2014. 01:45 PM | 1 Like Like |Link to Comment
COMMENTS STATS
2,385 Comments
2,565 Likes