Last month I spoke about "migration" and the idea that investors were warming to the idea that the S&P 500 had struck a bear market low. June certainly seemed to give weight to that thesis as the S&P 500 added 6 1/2%. With inflation cooling (July's Consumer Price Index was just 3%), investors have seemingly once again put on their rose colored glasses, seeing all that's good in the market. With everything looking good now, I'm reminded of my October 2022 newsletter. In the "What's Going On In The Market" section of that missive, you'll see these words, "Looking ahead, I'm feeling increasingly bullish for the first time in a long-time and I hope you are too. The hard to grasp truth is this: if you're not getting increasingly optimistic as the stock market goes down then you're doing it wrong. To those ends, in the last few weeks, I've been rotating out of cash and increasing exposure to stocks." Hmm. Could the opposite be true now? Investors seem to be "Revvin' up the engine...and shovin' into overdrive." But are we headed to the stock market's Danger Zone in the coming months? There's seemingly little to support that thesis at the moment, but I personally think if you're just getting bullish now, you're flying upside down.
Comments