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Dr. Kris
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Dr. Kris has two degrees from MIT because one just wasn't enough. Her life goal was to figure out the universe and having done that (at least to her satisfaction), she decided to tackle something even more difficult—the stock market. Applying the scientific method along with an insatiably... More
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  • Market Notes: Time To Run For Cover? -- April 25 7 comments
    Apr 25, 2013 5:10 PM

    4:00 pm ET: Today the market marched in like a lion and limped out like a lamb. The mid-day turnaround looked to be the bulls passing the baton to the bears. For the past few days we've been noting that the VWAP's (a measure of "Smart Money" activity) on both the buy and sell sides have been elevated indicating a possible changing of the guard. Note that there are only three more trading days left before the "Sell in May" phenomenon kicks in. Of course there are no absolutes in the market and, yes, this year could indeed be different--but I don't think so. I gave four reasons to support my thesis yesterday. Here's another one to add to the pile.

    Yesterday, CNBC ran not one but two separate segments showcasing bigwigs at Goldman Sachs, both of whom are bullish on the market. The reason they gave was the same: Their in-house economists think the world is in a state of economic expansion which will continue to fuel not only our stock market but markets abroad as well. I don't know what numbers they've been looking at but I'm sure not seeing much that cheers me. Recovery in the Eurozone is tenuous at best and who knows what China's growth stats really are?

    In this country, not everything is as rosy as it's being painted. Sure, the financial media has been touting that 70% of all companies that have reported so far have beaten earnings estimates but what they've been omitting is that overall revenues are falling. This fact indicates economic contraction, at least it does to me. But not being an economist, I certainly could be wrong.

    Whatever.

    Putting this all aside, the fact that two spokes-folks came out publicly spinning the same yarn has me thinking that Goldman must be building up a huge short position in the equity markets. Yes, this is the cynical point of view but if past Goldman dog-and-pony shows are any indication, I'm sticking with it. (I've always been suspicious that something's afoot whenever Goldman trots out Abby Joseph Cohen.) With that said, I'm mounting my soapbox and recommending that people prepare to batten down the hatches as May could get very ugly.

    Subscriber Notes: There is one new Stock Darling.

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Comments (7)
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  • jason2713
    , contributor
    Comments (32) | Send Message
     
    rate cuts and continued QE is the only thing keeping the markets and the economy going. fundamentally you're right, but im not seeing anything to suggest this market has been running on fundamentals for a long time.

     

    Bonds, stocks and gold near all time highs? who is wrong? answer is no one when the printing is in full throttle.
    26 Apr 2013, 03:28 AM Reply Like
  • Dr. Kris
    , contributor
    Comments (322) | Send Message
     
    Author’s reply » Jason,

     

    You can see by this week's rush by the retail investor to buy physical gold and silver that people are desperate for some sort of yield. However, the market won't go up forever despite continued printing--valuation will at some point become a concern.

     

    Thanks for adding your thoughts!

     

    Dr. K
    26 Apr 2013, 02:17 PM Reply Like
  • stabletker
    , contributor
    Comments (57) | Send Message
     
    Every 'Sell in May' the pendants come out of the woodwork and defend the market and just about every May the markets retreat.
    28 Apr 2013, 09:56 PM Reply Like
  • Bruce7b
    , contributor
    Comments (607) | Send Message
     
    Dr. Kris: Congrats on the Barron's article. Just read it at our local library here in the mountains of western NC. Was surprised by the article since I have been a very regular reader of SA over the last two years and had never read one of your articles. Was not familiar with the instablog category so will have to start reading those. How did Barron's select you as the focus of an article, I wondered to myself.
    29 Apr 2013, 11:26 AM Reply Like
  • Dr. Kris
    , contributor
    Comments (322) | Send Message
     
    Author’s reply » Bruce,

     

    Thanks for reading the article and checking out my blog. I have no idea how Barron's selected me except that the writer said he thought I was interesting being that my background isn't that of your standard typical investment professional's.

     

    I'll have to take his word on that.

     

    Dr. K
    29 Apr 2013, 12:01 PM Reply Like
  • stabletker
    , contributor
    Comments (57) | Send Message
     
    I think they picked you because:
    Your smart,good looking,interesting,know about outer space,not to mention an MIT PHD! Last but not least you make stock 'things' seem fun and interesting!
    gk
    29 Apr 2013, 05:05 PM Reply Like
  • Dr. Kris
    , contributor
    Comments (322) | Send Message
     
    Author’s reply » Aw shucks, stable! Thanks for the kind comments. Made my day!

     

    Dr. K
    30 Apr 2013, 01:06 PM Reply Like
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