Tag Archive for: optimism

Optimism watch: "Could Bear Talk Be a Contrary Signal?"

“Doing the reverse of the crowd has often worked well,” as New York Times columnist Floyd Norris points out in “Could Bear Talk Be a Contrary Signal?

So the fact that consumers feel unusually gloomy about the stock market, according to the Conference Board’s latest consumer confidence report, may bode well for stocks.

More than half of those polled expect stocks to decline over the next 12 months. However, as Norris reports:

In the past, there have been only six market cycles when the proportion of bears reached 36 percent. Five of them were excellent times to buy stocks, and the other one was followed by a decent return.

If you only want to read an optimistic spin on these numbers, do NOT read Mark Hulbert’s “The Stars Have Yet To Align For Stocks,” also published in The New York Times.

This blog post is part of a recently launched “Optimism watch” series on this blog.

Optimism watch: The case for maximum pessimism

Is the stock market getting you down? I’m starting an “Optimism watch” on this blog. 

In “Optimism watch” posts, I’ll highlight the case that other writers make for you and your clients to hang in there.

Let’s start with a quote from “Nowhere to Hide: Foreign Funds are Falling, Too,” from Morningstar’s Bridget Hughes.

…before you fall into deep despair, I’d remind you that the late Sir John Templeton made a highly successful career investing where he saw “maximum pessimism.” We’ve been here before. Markets are cyclical. Keeping a truly long-term perspective (10 years or more) can be liberating, and you may realize this is a time to add to your holdings.

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