The AAII Investor Sentiment Survey for the week ended yesterday shows the bulls melted away last...

The AAII Investor Sentiment Survey for the week ended yesterday shows the bulls melted away last week, falling 13.4 points to 28.4%. Bears gained 4.1 points to 36.6%. The survey clearly reflects the knee-jerk response to the perceived-as-hawkish Fed minutes (as captured with Dennis Gartman's classic "Sell" call).
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Comments (12)
  • Tack
    , contributor
    Comments (16279) | Send Message
    The" wall of worry" lives! Euphoria hasn't even been born, much less getting carried away.


    This is a good environment for value investors.
    28 Feb 2013, 08:04 AM Reply Like
  • Placebo Investment Advice
    , contributor
    Comments (4007) | Send Message
    "This is a good environment for value investors."


    Not for smart value investors---those who carefully avoid undue risk (like Seth Klarman and Bob Rodriguez). Ben Graham would probably close up his fund if he were alive. You would never find Graham, Klarman, or Rodriguez throwing money onto speculative kindling like Beazer Homes.


    Guys like you will, in due course, be flogged just like in 2008-2009...yet again.
    28 Feb 2013, 03:44 PM Reply Like
  • Tack
    , contributor
    Comments (16279) | Send Message


    Yeah, I'm a "dumb" value investor. Just been doing it for almost twenty years and supporting myself and family in a very comfortable retirement for about fifteen of those. And, notice, during that period (~1997-2013), it's been such a simple, unchallenging market. I mean, it's just been straight up, right?


    There are always values around. Smart, thoughtful, thorough, unemotional investors find them. Funny you mention it, but Beazer, Hovanian (BZH and HOV had mandatory convertibles that were high-yielding gold mines for those that did their homework) and some other homebuilders were fabulous buys; you just had to have that vision when everybody hated them, not now.


    One wonders how you make your own money, if you make any, because you seem to be relentlessly cynical and negative on almost everything, all the time. It suggests someone frustrated with their performance, not happy or confident about it.


    But, feel free to criticize, if that floats your boat.
    28 Feb 2013, 04:51 PM Reply Like
  • Macro Investor
    , contributor
    Comments (9252) | Send Message
    Love it. We need to take the money away from the bears. What a whiplash this week. The perfect set up.
    28 Feb 2013, 08:15 AM Reply Like
  • Petrarch
    , contributor
    Comments (1126) | Send Message
    premature bearishness I love it
    very unfortunate for them but good for me
    fascinating hwo you would pay a fee for such stupidity


    need to wait unitl the economy is roaring and the Fed funds rate is higher than nominal inflation. this is pretty basic stuff.


    we are not there yet


    28 Feb 2013, 08:47 AM Reply Like
  • thechaser
    , contributor
    Comments (761) | Send Message
    "premature bearishness"? "take money from the bears"? no "euphoria"?


    please, keep bidding things up; i am happily selling every long I have and on days like 2/19, borrowing your long shares and selling them as well;


    i welcome your fanning the flames of bullishness; please keep it up until you cannot;


    oh, i forgot things only go up and up and up and up... until they don't
    28 Feb 2013, 08:57 AM Reply Like
  • eagle1003
    , contributor
    Comments (1887) | Send Message
    chaser: You have longs? When were you bullish?
    28 Feb 2013, 09:26 AM Reply Like
  • Nate Sterling
    , contributor
    Comments (615) | Send Message
    Some people had an irrational panic reaction just because a minority on the Fed raised questions about ending QE3 at some point this year. But that was the minority position. The majority position has remained the same, that QE3 and low interest rates will remain in force well into 2014 or maybe even 2015 as the recovery needs to strengthen considerably to get us below 6.5% unemployment.
    28 Feb 2013, 09:50 AM Reply Like
  • thechaser
    , contributor
    Comments (761) | Send Message


    my blogs state that i am very bullish on long term real growth derived from 1% net global population growth and that i am very bearish on the the short term effects of the machinations in the western 1st world financial system;


    i said BUY BUY BUY in late sep 2011 and again in nov 2011 and have maintained we will see 3500 on the snp500 by 2020 and for sure the dow 36k


    BUT, when i watch the bedrock stocks on which real growth is based and not the consumption stocks which are guaranteed to rise with the currency devaluation process, they tell a story that the economy has not caught up with the financial stimulus because the largely ill effects of currency devaluation fall the hardest on the majority of the population and only benefit the financial asset owning elite;


    so TM went from the 70's to the 100's in 90 days because somehow the world decided they were on a tear making great vehicles with no competition? no, the japanese are playing catchup in the devaluation race; so GS went from 115 to nearly 160 in the same period because of superior financial management? no. they did so because of the continuing policy of financial intervention since the power elite broke the symbolic hold 40 some years ago insures some short term gains for the inside track;


    so yes, i am long and wholeheartedly cheering the Macroinvestor's, the Tack's, to help push this market and get the p/e expansion train going; i still have lots of longs to sell whose more depressed values reflect the real world and are the laggards that only when the optimists get things really hyped up, will they catch the wind and go, i will sell, wait until the blowoff/blowup and then repeat
    28 Feb 2013, 11:01 AM Reply Like
  • Tack
    , contributor
    Comments (16279) | Send Message


    I'm a value investor, not a momentum guy.


    The market will continue to rise, even without P/E expansion, simply because nominal revenues and earnings will continue to rise. Now, of course, some will say that those gains are not "real" (i.e., they're just inflation), but, that matters not a whit because investors can only invest for nominal gains. One can only calculate one's "real" gains in retrospect; therefore, it's a meaningless metric.


    When major P/E expansion does occur, when euphoria sets in (we're far way), yes, then it will be time to lighten up.
    28 Feb 2013, 11:19 AM Reply Like
  • Nolesince87
    , contributor
    Comments (259) | Send Message
    I doubt this is right or has any value. Everywhere I look people are still gidddy about this market.
    28 Feb 2013, 11:04 AM Reply Like
  • Ananthan Thangavel
    , contributor
    Comments (835) | Send Message
    Usually readings of 2 times as many bulls to bears or vice-versa are useful as a contrarian indicator. This one does not fit that description, but it is also not even as useful as the headline might appear.


    The reason why is because there is a third category, the AAII Neutral index. The survey asks individual investors if they are bullish, bearish or neutral over the next few months. At this point in time, bullishness has dropped by a quite a bit over the past few weeks, but it has been largely replaced by neutrality, not by bearishness. The AAII neutral index was at its highest level since August 2012 this week.


    This could be viewed as a bearish precursor, as most investors don't usually swing directly between bearishness and bullishness in their actions, but instead prefer to "wait and see." I believe if the market turns down again and goes below Monday's low of 1487, we should see significantly more selling, setting up a situation similar to spring 2012 as neutral investors become sellers.
    28 Feb 2013, 01:56 PM Reply Like
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