Blindfoldedmonkey: THE COMMON GAME NOW IS THE GUESSING. BUBBLE, NO BUBBLE, BUBBLE, NO BUBBLE...

Tuesday 19 November 2013

THE COMMON GAME NOW IS THE GUESSING. BUBBLE, NO BUBBLE, BUBBLE, NO BUBBLE...

Each day I can find hundreds of articles, blogs which are concerned about that market is in bubble, the other half is positive about that is not yet a bubble. I belong to the no bubble school.


Why? Very simple. I have 6 arguments only.
  1. If not yet everybody is optimistic is good because the sceptical’s potential buying power will later come in the market, at the final parabolic phase. 
  2. In bubbles everybody convinced that nothing wrong can happen. Now is not true yet. 
  3. The market just broken out from 14 years ranging period last month. 
  4. There is cheap money out there. The interest rates are in historical low levels. 
  5. Ther is QE which protects the market from the big correction, over 15-20%. 
  6. Fundamentally the US corporates are more profitable then ever. 
Those observations of mine don’t mean could not come any correction. It is always possible. What I only wanted to emphasize the market is tremendously bullish. And in the bullish market only three positions we could possible have:
  • Very bullish 
  • Bullish 
  • Neutral 
Yesterday the Dow jumped above 16.000, SP500 went up to 1800. Both are all history highs.


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