Thursday, February 6, 2014

Brute Fear

All our times have come
Here, but now they're gone
--Blue Oyster Cult

Nice multi-panel display that adds to our collection of market extreme graphics. Margin debt, valuation, macro, sentiment...

The set up has market sage Richard Russell fearing an epic wipe-out:

"Since infancy I've always been ultra-sensitive to danger. For this reason I've never been caught in a primary bear market--my sensitivity to impending danger (and Dow Theory) has always saved me and my subscribers. But this time my unconscious fear is unrelenting, and it won't leave me alone.

"Finally, I've admitted it to myself. I'm afraid we're in a primary bear market in the economy and the stock market. I believe it's going to be an absolute 'brute.' And I'm afraid of what might lie ahead."

position in SPX

1 comment:

dgeorge12358 said...

In 1933, the government devalued the dollar by 41% by raising the official price of gold from $20.67 to $35 an ounce. Devaluation makes debt easier to handle. In a devaluation, the dollar value of debt remains the same, but all other assets would be worth more (in nominal terms) whether it was a house, a stock, a car or an ounce of gold.
~Richard Russell