All investors have a sure-fire signal for when to liquidate their portfolios and head for the hills. We highlight one investor’s concern that markets are a ‘basket case'. Certainly you can feel the increasing nervousness in the market. Volatilities are definitely on the rise.
* Institutional investors are also getting increasingly nervous that we have reached the end of
the road and a major market top may be forming in equities. Notwithstanding particularly
concerning economic data out of the formerly reliably robust Chinese and German economies,
many market commentators are pointing out that US inflation expectations have now slid to
levels that previously triggered the Fed to enact QE yet there seems to be absolutely no
prospect of that occurring currently. Quite the reverse. So maybe its time to stop dancing and
sit this one out. Am I calling a top? Whats the point? As an uber-bear I am used to being
called a stopped clock. By contrast the market embraces a bullish forecaster however often
they are shown to be overly optimistic. The IMFs forecasts for world growth have just been
published and guess what it sees world growth rebounding, just as it has done consistently
for the last few years! The market doesnt care that the IMF has been serially wrong and that
its forecasts resemble a series of hockey sticks (H/T Zero Hedge). The market loves a bull,
even if it is a stopped clock too.