* In the February, 2011 Marketimer, Brinker said: "....later this year."
* In the March Marketimer, Brinker's time-frame was "within one year."
* In April, he extended that to read "within the next 12 months."
* In June, he completely removed the time frame and said: "We expect to see new recovery highs in the S&P 500 Index 1400s range as part of the ongoing cyclical bull market trend."
* In July, the "low-to-mid 1400's" goes full circle and is back to "going forward." (There's nothing like a 15% correction to inspire a time extension.)
So where are we now? Today, the S&P closed at 1353.22 -- higher 7 out of the past 8 days, and up 7% in the past 8 days. The S&P is now less than 100 points below Brinker's low-to-mid 1400's target range.
What will Brinker do if it reaches his target? Will he call an end to the cyclical bull market "going forward," or will he simply raise the target range?
Here is my opinion based on my knowledge of his market-timing history: Brinker will never again issue a sell signal and advise raising cash reserves.
Here is why: Everything that he has said over the past few years has boxed him in a corner so that it would be difficult for him to give a sell signal and have any credibility left.
Firstly: He is on record saying that the market has to drop over 20% before it is considered a bear market.
Second: He won't sell during a 10% correction because he has said that if you can't tolerate a 10% correction, you shouldn't invest in stocks.
Third: He won't sell during a correction that drops between 10-20% corrections. He just proved that again for the umpteenth time by not even mentioning the 15% correction last month.
Finally: If the market drops more than 20%, he acknowledges it's a bear, but is on record saying he won't sell into weakness. Indeed, he proved that when he rode the 2008 bear down over 57% while advising listeners and subscribers to remain fully invested.
Conclusion: Those four facts put him in a box which I believe will preclude him from ever again issuing a sell signal and raising cash. This is even more true than ever before because the market has gone virtually nowhere over the last decade, unlike the decade of the 1990. The 1990's decade gave him the opportunity to raise cash at the end of it almost at the top. But even then, he only raised 65% cash.
June 22nd, TFB gently set me straight: :)
(Honey said): "On Moneytalk, Brinker often ignores this very recent bear market and harkens back to year 2000 which was the last time he raised 65% cash from his model portfolios. That would have been a very good call"
No it would not have been. He claims he can time the market and 65% is a hedge and he hedge it more because his initial call was a 50% shift not 65 - he crept into the 65%.
And if you recall he set the whole thing up as a hedge...the transcripts woudl reveal that. He was nervous and unsure and he couched his recommendation in so many caveats it is obvious he was unsure.
You either can time the market or you cannot. If you think a bear is coming keeping 50-35% in is asinine. It means you don't really think you can time the market. So he should change the name form Market timer to kind of sort of wishy washy market direction adviser.
You really are being too nice here. You don't set an egg timer so can take one or two of the eggs out of the water while the other continue to cook and you don't buy a market timing subscription service so only part of your portfolio goes to hell.
tfb
Additionally, it's good to be aware that the only time that Brinker ever went to 100% cash was after the 1987 market crash -- and that was a mistake because he missed out on a lot of gains before he finally got back to 100% invested two years later.
Yep, there's a lot of cyclical/secular bulls/bear market sizzle on the barbie, but is there any steak? :)
17 comments:
U.S. economy adds just 18,000 jobs in June
Payrolls data stun Street
Economy adds jobs at a slower pace in June than in May, suggesting that the slowdown in the economy might be more severe than thought. Nonfarm payrolls rose by only 18,000 in June. Jobless rate is 9.2%
Oops, this is not good at all!
Provided by Schwab Center for Financial Research
Bulls Corralled by Weak Jobs Report
US equities are sharply lower in early action, as nonfarm payrolls came in far below expectations, while the unemployment rate ticked slightly higher to 9.2%. Nearly every aspect of the report was disappointing, including a downward revision to last month's gain, as hopes of a turnaround in the jobs market that were raised by yesterday's ADP report were severely dampened.
Unemployment now 9.2%, but the actual number of unemployed is over 16%
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Please excuse my ignorance here but ---Who is TFB?
TFB is the one and only The Fluffy Bunny!
But don't let the handle fool you. He is neither "fluffy" or a "bunny." :)
.
OK.!!??
A pundit who calls himself "The Fluffy Bunny"..:) And we are supposed to take his comments seriously because...?????
Because he has enough courage to create a handle and use it consistently so that he takes full responsibility for what he writes.
Something it appears you do not have.
.
Payrolls data stun Street
I imagine this was UNEXPECTED again by the MORONS in Washington.
It makes you wonder how these supposedly intelligent people can be caught off guard each and every month.
Mebbe some genius anonymous nitwit can s'plain it to a dumb pig?
Even better, mebbe that drugged up moron from several threads ago can s'plain it here. He's still posting and taking nasty shots at people that will never read those old threads.
I always go back to read, since I'm very familiar with drugged up liberals that like to spout off their ignorance on old threads, and try to make it look like they had the last word.
They usually do have the last word, after they have been ignored for days........then they return with nasty, STOOOPID remarks that make them feel superior to the fleas and roaches that they hang around with.
Anonymous said...
OK.!!??
A pundit who calls himself "The Fluffy Bunny"..:) And we are supposed to take his comments seriously because...?????
I suspect that would be for the same reason we take the comments seriously from anyone posting as anonymous.
On a previous thread, HB mentioned that the English language is the official language of aviation. It reminded me of this joke:
A German pilot for Lufthansa was getting ready to land in Frankfurt, Germany, and he spoke to traffic control in German.
The tower quickly corrected him, telling him that all communications MUST be in English.
He replied "I am a German pilot, flying an aircraft owned by a German company, landing in Germany, why must I speak English?"
Just then a very cultured, very British voice came on the radio, from a pilot of a British Airways, plane: "It's very simple, old man ... YOU LOST THE WAR."
Frankj
Anonymous,
Please keep your language within the realm of civility instead of guttural street level.
That may be acceptable language in your world, but it isn't here.
.
Just three hours ago, Laksmann Achuthan said the economy is "downshifting." Not a recession, but a definite slowdown. He will be surprised if market takes off on "sustained basis."
"As the financial world emitted a collective groan when the June jobs data crossed the wires this morning, Lakshman Achuthan was calm, unmoved and not surprised. In fact, the co-founder of the Economic Cycle Research Institute says he's seen it coming for months.
"The economy is down-shifting...you can see in the jobs number that the sand is shifting," he says."
See the interview and read more
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Why The Social Security Debate Is Upside Down
By Jed Graham
Washington policymakers are trapped in a Social Security lock-box of their own making. The menu of regressive reform options would make the safety net weakest where it needs to be strongest — in very old age.
The option put on the table this week by the White House — holding down cost-of-living adjustments based on a lower measure of inflation — is among the worst offenders in this regard. It leaves present-law benefits unchanged for 62-year-olds but cuts them for everyone else — including current retirees.
By age 75, reduced COLAs would take about 4% out of a retiree’s Social Security check, rising to 6.5% at age 85 and 9% at 95, according to a Social Security Administration analysis.
Consider that Social Security provides at least half the income for three-fourths of households with someone 85 or older. As rising life expectancy puts retirees at greater risk of outliving their savings, this is the least sensible place to cut benefits.
http://blogs.investors.com/capitalhill/index.php/home/35-politicsinvesting/2667-why-the-social-security-debate-is-upside-down
Oops, this is not good at all!
No, it may be awesome,. I do not care if I lose every dime and starve on the streets as long as my grandchildren will still know the sweet taste of freedom and liberty. The most important thing we can do for their future is get rid of Obama. The more unemployment, the more uncertainty the closer we are to getting this ass out of office. I fear thought that next election is very far off...sigh.
tfb
"The most important thing we can do for their future is get rid of Obama. The more unemployment, the more uncertainty the closer we are to getting this ass out of office."
Oh good, you want MORE folks to loose their jobs and MORE uncertainty in the economy.
The worse things are the better they are in your mind.
Maybe you should join the anarchists.
It won't matter anyway, Obama is a shoe-in when you look at that group of losers Republicans. Not a one of them has a chance in hell.
Maybe you should join the anarchists.
What makes you think that we need more members?
Giving advice is not such a successful endeavor for you.
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