La bourse reflète l’économie mais qu’au moment où elle le décide

Le plus grand défenseur de la cause bear de ces 5 dernières années se dit dans sa lettre mensuelle, navré pour tous ces bears qui se font squeezer actuellement par le marché. Cela lui rappelle la dure réalité que le marché fait toujours ce qu’il doit faire mais jamais quand. Une autre façon de dire que le marché reste décorrélé de la réalité économique mais que personne ne peut prédire quand la bourse s’en rendra compte et décidera de corriger les excès. Ce qui en attendant, aura ruiné bien plus d’un bear impatient.

“I can’t believe I’m saying this, but I really feel sorry for the bears. First, they rubbed their hands together in glee as they waited for the roof to cave in via the fiscal cliff. Nothing happened. Then they got excited over the sequestration menace, and again nothing happened. Cyprus came and went, so what’s left? Oh yes, the debt ceiling — which, if it isn’t lifted, should collapse the economy. And it does seem we are in a currency war. Japan’s new central bank president startled the world by doubling its QE quotient. Japan, copying the Bernanke recipe, will buy everything in sight until Japan experiences 2 percent inflation.

How can I explain the weird disconnect between the stock market and reality? I fall back on the old Wall Street aphorism — “The market always does what it’s supposed to do — but never when.” I feel most sorry for the impatient bears. Waiting on the market to do what you think it should do can try one’s patience and nerves.

It looks as though the stock market will continue to head north until we receive indications that something is wrong. So far, nothing in the price structure has told us to be cautious. My guess is that this stock market will, when it is ready, produce some kind of “warning pattern,” such as a formation (H&S pattern) or a distinct non-confirmation in the Averages. Until then, my suggestion is to stay with your position in the DIAs.”