Red Thumbs: Not yet...
In response to :
reply: to OutOfFocus: Gentlemen, Start your red thumbs..
Excellent post. It indeed educated me, and will put me on high alert (avoid being an idiot)
Here's the deal. You haven't provided a single reason why you consider 7700+ as a cut-off for idiots to enter. Maybe that cut-off is 9000, maybe 11000+. How do you know its 7700.
Also, have you ever considered the fact that people who bought it at the recent bottom (like I did a few) were not innovators but just plain random lucky. I don't consider myself a market predictor just because I managed to buy a few stocks at the bottom. Well if I was, I wouldn't be the idiot who bought all of 2008.
In any case, only time will tell whether the people who are still buying are idiots, or those sitting on the sidelines are idiots. Its a toss off, so either way, you cannot really prove one is smarter than the other. Real smartness comes from consistent performance over long run.
I disagree that this is a suckers rally or bear market rally. I feel market is throwing mixed signals. While some companies that I like and follow are way over bought, actual verdict on them really depends on the answer to this question, "are we really in a recovery?"
If i ask any small businessman, he says, it will atleast take another year to recover. However, if I review results of companies, I find that in some instances, sales have fallen only 5-10%. You cannot really manipulate sales like you can manipulate EPS. There are many many companies that have recently reported encouraging sales. Not massive growths, but indeed shown improvement. These are the same companies that had worse previous quarters (as compared to same quarter in previous years). So I am making an Apple to Apple comparison.
Look at BWLD, CMG, BBBY, IBM,COH, CSCO, APOL
Sure, there are reasons for why each one reported good earnings or reasonably earnings, earnings/sales that I see as signs of economic recovery perhaps? Sure, I don't really believe in any of the financial stocks yet, but I do believe there is a slight bit chance that perhaps top fools like EverydayInvestor, GMX etc are wrong, and up and comers like UltraLong are actually right?
I will just urge top fools to blog and more aggresively put forward their bearish or bullish case if indeed they are so convinced.
As for now, I am not an innovator, but I feel, maybe, just maybe markets were too oversold on March 6th, and mayb just maybe, investors decided to unleash their cash horde and make some long term bets. Even the best here will concede that stocks priced on March 6th or 9th were ridiculously low. I know for a fact that if I didn't go all-in on March 6th, it was because I was greedy. I wanted them cheaper. Sometimes, if you try to be uncle scrooge, you get nothing. Sometimes, you have to payup for quality or lose the chance to get that price forever.
March 6th 2009 was when markets hit a 10 year low. Have can top fools ignore that fact? Is the U.S economy so bad? Come on.