When all you read is gloom, turn here for a much different perspective.

Thursday, February 19, 2009

The Bull Market Move: Swift And Steep

Several of you have recently ask where the stock market is heading and when will it rebound. You probably know however that I am not an investment adviser. There are several investment firms however that are worth a close look if you are seeking investment counsel:

1. Fidelity Investments
Here is an overview of their four and five star funds.

2. T Rowe Price
Here is a list of their funds with historical performance,

3. Fisher Investments
Here is their investing philosophy.

Although I do not have an account with Fisher, I find some of their materials quite in line with my personal investment philosophies. For instance, here are some excerpts and tables from a recent Fisher newsletter:

"In our view, markets are highly likely to rebound sharply in the period ahead. Bounces off market bottoms historically have been fast and huge -- and we think the recovery can't be too far ahead whether or not the very short-term markets are up or down."

If you visit their site, you can download and read their full newsletter. However what follows below are two charts from that newsletter republished here with their permission:

Just like you read here every day, Fisher says "at every turn people seem to be ignoring the positives to focus strictly on the negatives... in times like these optimists are seen as crazy, just like in bubbles markets pessimists are seen as fools."

But there is no doubt that eventually sentiment will change. And according to Fisher, "when it does the initial bull market should be swift and steep, leaving many in the dust."

That statement might just remind you of why Warren Buffett was doing what he was doing back in 1974. (and in 2008 as well)


  1. What is your reaction to Alan Greenspan's comments that we are in the '30s and the banks need to be nationalized?

  2. Anonymous,

    I believe the Greenspan quote to be something like this:

    "It may be necessary to temporarily nationalise 'some banks' in order to facilitate a swift and orderly restructuring," he said. "I understand that once in a hundred years this is what you do."

    Nationalisations would "allow the government to transfer toxic assets to a bad bank without the problem of how to price them."

    I would agree with his "some banks" statement... the majority of the toxic assets are/were concentrated in the top 10-20 banks.

    (Unregulated by the Greenspan era. He now expresses "disappointment" in their unregulated ability to maintain appropriate liquidity for their institutions.)

    But I continue to maintain as I have for many months, that except for these "elite" banks, which should be nationalized if needed, there is no credit crunch at most banks. See that story on the "article lists" to your left...
    (In the great depression, over 11,000 banks failed... not just the top ones.)

    I'll have more details on just how well the bank and commercial credit markets have "thawed back to health" since October over the weekend.


  3. Thanks Premium Collector...

    I can collect good news and spread it as far as I have wings... but it is not about me at all, I need all of you to use your email, your diggs, your blogs, your websites, etc... to spread it further... good news is contagious, just like bad news... it's your choice on which you want to spread...

    Thanks again!

  4. check out this timeline on the Great Depression: www.huppi.com/kangaroo/timeline.htm

    Assuming its facts are correct, there is no comparison to today's economy and it suggests the work the Fed is doing and the impact of the stimulus will help soon.

  5. There can be no doubt that the bounce from this low will be nothing short of amazing. The only problem we have left is finding a credible assessment of the damage done to our financial system. Whether we nationalize or not, doesn't matter to me. We simply need to get the uncertainty out of the equation. Once that happens, we can finally start moving forward again.

    Eldon - I posted a chart that shows the long-term cycles in the market that I think is some really good news. We're nine years into a stagnant cycle, meaning we're not too far from better days.

  6. Thanks Michael,

    I've had a look at your post and article. I particularly like your points on changing perspectives over time...

    I my mind keeping things in perspective is what it is all about...

    Thanks again.


  7. Hmmm.. Oct 74, Aug 82, Dec 87, Nov 90, Oct 02 -- all time periods when the media was at its most hysterical zeniths of economic gloom and hopelessness. And, as the charts show, the beginnings of renewal.


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