People who should know better (on CNBC, in equity research departments, etc.) got really excited after last week's surge in U.S. market indexes. I was pretty sure the rally wouldn't last long, and today's action confirmed it:
We're in a recession? Really? (Sarcasm filter off now.) Maybe the excitement of the non-smart Wall Street preppies has died down now that the recession is official. There's nothing surprising about an occasional rally in a secular bear market. Hope springs eternal, and some money managers live quarter to quarter instead of decade to decade. I wonder which active money managers tried to pick a bottom and buy what they thought were cheap stocks to dress up the next quarter's performance. Wall Street pros just can't shake the herd mentality, no matter how much they tout their "independent thinking" in sales literature.
I tell ya, my bear plays look better and better each month. I'm sticking with them (although I'm still thinking about going long VWO at some point in 2009).
Nota bene: Anthony J. Alfidi holds uncovered calls on SPY, IWM, EFA, and VWO at the time this commentary was published.
The stock market suffered one of its worst days since the financial meltdown Monday, slicing 680 points off the Dow Jones industrial average as Wall Street snapped out of its daydream of a rally and once again faced the harsh reality of a recession.
(snip)
Erasing any lingering doubts, there was also finally an officially declared recession -- in progress in the United States since December 2007, according to the National Bureau of Economic Research, the nonprofit group of economists that classifies business cycles.
We're in a recession? Really? (Sarcasm filter off now.) Maybe the excitement of the non-smart Wall Street preppies has died down now that the recession is official. There's nothing surprising about an occasional rally in a secular bear market. Hope springs eternal, and some money managers live quarter to quarter instead of decade to decade. I wonder which active money managers tried to pick a bottom and buy what they thought were cheap stocks to dress up the next quarter's performance. Wall Street pros just can't shake the herd mentality, no matter how much they tout their "independent thinking" in sales literature.
I tell ya, my bear plays look better and better each month. I'm sticking with them (although I'm still thinking about going long VWO at some point in 2009).
Nota bene: Anthony J. Alfidi holds uncovered calls on SPY, IWM, EFA, and VWO at the time this commentary was published.
