Marcus Aurelius

The Rally, When It Comes, Will Be a Doozy

I like to think of markets as a spring. Right now the spring is getting wound up tight on the downside, sooner or later whatever force is holding the spring in place will have to let go and watch that energy go the other way.

Think oil. Last summer the CL spring got wound real tight on the plus side, it let loose and look where is it at now? One guy last fall was calling for $30 oil and the prevailing comment theme was "what are you smoking". $30 was too low, but it wasn't that far off.

One thing I do agree with though is demographics may put a lid on any equity recovery. Even when the public is back in the mood for equities most likely a fair amount of that public will not return because they need income and not growth. Interestingly enough, that same demographic trend will relieve the pressure on rising medical costs.