* 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? :)
