Total Capitulation of the Bears

One of Wall Street’s ‘Biggest Bears’ Throws the Towel Recently we have come across one of those forecasts that are a dime a dozen these days, and usually escape out attention. The article at Marketwatch, entitled ‘Bull could run 5 more years, carry S&P 500 close to 3,000′ only seemed interesting because the forecast sounded a bit extreme. We quickly scanned the headline, thinking that whoever was making this assertion surely hadn’t breathed a word about this when the SPX traded at just below 670 points in March of 2009. Such wildly bullish forecasts are strictly a function of SPX 2000 in our opinion, on a par with the ‘Dow 36,000′ forecast, which gained some notoriety in the late 90s. One of the reasons behind the SPX 3000 forecast mentioned in the article did amuse us greatly though, namely the following:
‘They cite extensive deleveraging in the U. S. as well as the uneven global recovery among other reasons why ‘this could prove to be the longest U. S. expansion – ever.’
(emphasis added)
Extensive deleveraging! Right.
‘Extensive US deleveraging’ in one comprehensive chart

This post was published at Acting-Man on September 5, 2014.