Fred Voetsch

Gold Is Not in a Bull Market

On Nov 02 05:23 PM maketalwaysgoesup.. wrote:

> This market always goes up. DJIA 10,600 soon
>
> good articles: financeopinionss.blogs.../


Tell that to the Japanese. But in fact, this market is substantially lower than it was not much more than a year ago and is about the same level it was at ten years ago with the NASDAQ being much lower. If you count the companies that have been removed from the various indices they would be much lower.

Gold Is Not in a Bull Market

The mother of all bull markets? Hardly.

30 years later gold is only up slightly from it's high in the early 1980's while the stock market in 2007 was 14x its previous bull market high in 1966.

I can only think of one person who I know that owns actual gold. Public speculation has not yet begun and it will likely be in full force before we see the highest prices.

Given that information and the wholesale printing of worthless, fiat currency, I would suggest that gold is the bull market of the future.

Lessons from a Market 'En Fuego'

"The other day Laszlo Byrini made a comment that I have made many times before (not sure who originated it) which is that the bear case is always more compelling and more articulate. I can't make a convincing bull argument. Ages ago (the end of 2008), I made the case for a big snapback rally based on the simple fact that no matter how bad things are (were), after hideous declines the market retraces a noticeable portion fairly quickly."

The first part is a very good point. The second part points out its weakness since Byrini has been shilling the market and publishing bad PE data since late 2008, when the Dow was at about the same level as it is now. hmmm...

The bear case was right. THAT IS A FACT. The stock market is off 35% from its high and we are still in a primary bear market, according to the foremost experts on Dow theory and are in a classic bear market rally. All you are doing right now is setting yourself up to look like a complete and total fool when the primary trend continues.

I suggest you listen and learn as you go through life rather than spending the majority of your time an effort in justifying your bad decisions. Look up "The Greatest Bull Market in History" and actually see how people made excuses and continued to lose their wealth because they couldn't see that the 1920's were over. Check out the period after the crash of '29 and see how similar that is to now. Note that we have much larger problems now than then.

Study historic valuations and you'll see that we have much farther to go on the downside - or many more years to go - before the market achieves those great valuations that mark the bottom of a SECULAR BEAR MARKET.

Perma bears ARE wrong but what do you say to someone like me or Gene Inger or Richard Russell or the many others who have always been bullish and only turned bearish recently and have good reason and still have good reason? It seems to me you make excuses and the same mistakes that the perma bears make.

Capacity's Comeback Strongly Indicates Recession's End

The recession is over but stocks are still historically overpriced by a good margin, if you believe we are in a long term, secular bear market, which will include many ups and downs but will cause the stock market to be revalued in a dramatic way.

Anyone who looks at what is really happening and listens to the smartest, independent thinkers out there (hint: Nobody at CNBC is on that list but Richard Russell, Gene Inger, Meredith Whitney, Louise Yamada and John Mauldin are) knows that there is much more pain to come before happy days are here again.

This is a relief rally and a blip upwards known as a "dead cat bounce".

So yes, you're right that this recession is over, but this is not the 1980's or the 1990's or the first part of the 2000's, this is a deflationary era that has already and will continue to destroy wealth by the trillions.

Understanding the 'Q' Recovery

BS. We WILL hit new lows over the coming year and the market will adjust for the excesses of the past decades. People like this are the tools of a bear market. The market must get gullible people to buy in again and again even though there is plenty of data telling them the market will correct for the excesses.

Only when people like this are asking "Would you like fries with that?" will it be time to go long for the long haul. Listen to Richard Russell, he'll tell you.

In Fed We Trust: Ben Bernanke’s War on the Great Panic, by David Wessel

"Wessel’s message is that over the last 22 years, leaders in our country, the Chairmen of the Federal Reserve’s Board of Governors, have operated on an ad hoc basis and in so doing have created a fourth branch of this government, a branch ruled by arbitrary decree."

This says it all. We have been building too high with little foundation and the pieces have long been in place for a catastrophe and we are only in the eye of the storm.

Cramer's Mad Money - Paul Krugman Is Wrong (8/10/09)

"While investors equate being bearish with playing it safe, it may well mean missing a 45% gain since March."

How flawed is such a statement and the thinking behind it? Very!

First of all most of the people who were bearish also missed losing 55% of their portfolio up until March (still being ahead by 35%) and most that I know, including me, caugh this rally early and only got out after a 20% or more runup.

The worst part of this thinking, of course, is that it's based on fear, the classic tool of a bear market. Folks, you'd better get in on this rally before it's too late...HURRY! HURRY! HURRY! Fear-based investing is always a bad idea. The only worse idea I can imagine is listening to Cramer the clown.

The Market Bubble Is About to Pop

"Stocks have dramatically underperformed their long-term average. In fact, the years from 1997 to 2007 may have been the worst ever in real terms."

What? This is completely wrong.

Five Reasons the Market Could Crash This Fall

The stock market may crash or it may not but it will likely crush a lot of people both long and short along the way. We were warned by some very smart people (Louise Yamada comes to mind) that wealth distruction is what is coming and to really do the job properly we have to be dealt with emotionally; the market will go up 50% and just when everyone jumps on board, scared to miss the runup the market falls. The market falls like a rock and just when everyone jumps aboard those double-short ETF's it reverses course and bulls ahead.

The market is us and that's what most never understand, and we have trained ourselves for the past several decades to believe we are genuises and can beat the market but my guess is that the market is about to beat all of us...senseless.

Fair Value for the S&P 500? Tell Me Lies, Sweet Little Lies

On Jul 29 08:54 AM CLH wrote:

> Macro man has been wrong for 5 months. He seems to be setting a record
> for being wrong the longest.
>
> For one year (2008) panic reigned as the frightened investors threw
> away their investments. The S&P will go a long way up as the
> losers continue to lose by not buying stocks (they are quite happy
> with their 0.5% bank accounts which continue to go nowhere.)

This is prime example of why one should not involve their ego when investing. CLH has ignored the fact that the market is still down about 40% from its highs in 2007 and by any measure is in the throes of a bear market. Many wise people did see the bounce from the lows in March and profited and are now out, waiting on the sidelines, a perfectly reasonable and prudent startegy, imo.

I have taken losses believing that the market had topped but with a good strategy those losses have been limited and I will be in position when the market has head faked enough people and really makes its move. If I am wrong I may even end up back where I started in 2007...a reasonable position, as far as I'm concerned.

Given the historical data on valuation and current economic climate there is almost no chance the market will continue higher past a point of simply filling the gap left from the crash of October 2008.

Fair Value for the S&P 500? Tell Me Lies, Sweet Little Lies

"...It's also a pretty good indication that if someone tells you that they "know" what fair value is for the SPX or equities generally, they're almost certainly lying."

A great article but the conclusion should be that "fair value" should be based on historical data. That means we use reported earnings to apply the historical range of P/E ratios. Given that Standard & Poor's predicts a P/E of 26 at an S&P 500 level of 919 at the end of 2010, I would say that we are easily way above fair value. Only if you believe we can expect high growth in the coming months and years can you provide any sensible, fact-based arguement and even then then it is hard to argue that the stock market is undervalued.

The market will do what it's going to do in the short run but in the long run it will revert to a reasonable level of valuation and that is much, much lower than where it is at currently.

See S&P's data for yourself:
www2.standardandpoors....

Options Trader Weekend Update: Charts, Art and Market Manipulation

On Jul 19 10:18 PM CLH wrote:

> When people are losing and all bears are losers, they look for excuses.
> The market was driven last year by total panic. What little movement
> the market shows now will be up. There are no sellers left.


Actually, according to Lowry's there are plenty of sellers and buying power is not showingthe strength one would expect from a bull market.

Options Trader Weekend Update: Charts, Art and Market Manipulation

A great article with points that need to be taken into account by every investor.

There are people & companies trying to sway the market and this is where we can actually profit because they can only blow bubbles for so long before those bubbles burst.

Can Anything Be Done About Housing Price Cycles?

"The interesting question is whether there's anything to be done about such housing prices cycles."


Not so interesting, except to note that these same questions are asked every time a bubble bursts.

80 years later when the next bubble bursts all the safeguards that were put in place will be ignored because, "This time things are different!"

Until then we will have the fresh memory of experience to keeps things in check, and that is what really does the trick.

China's Helicopter Wen: World Champion of Money Printing

Good data.

Keep in mind that earnings reports are often much better early on and tend to get worse. As well, beating lowered estimates is only good for awhile and then we need to see real growth. It is also wise to use S&P's data at www2.standardandpoors.... as they tend to be more consistent, truthful and realistic. As well, you get real data instead of just headlines that are meant to shill the market.

Read this line from the link above about Q1 2009 and compare with what you heard from CNBC, Bloomberg and the rest:

"Q1 2009 498 issues (99.70% mkt val) rptd: Qtr ending -39.0% below Q1,'08 and -25.5% off estimates, sales off -16.5%, As Reported down -51.5%"

25.5% off estimates??? You didn't hear THAT in the financial media.

Yes, we survived the end of the world as we knew it, now we have a long, hard process ahead of adapting to a new reality of slow or no growth, possibly for the next decade or two.