Monday, September 11, 2017

This market has surprising bullish strength

The Bull Market continues....

"The global bull market can absorb the seriousness of Hurricanes Harvey and Irma; it can absorb the continued threats from North Korea; it can absorb the threats to the very veracity of the European Union as the citizens of Catalonia are prepared to separate in a quiet civil “war” from the rest of Spain. It absorbs the high valuations to which share prices have advanced relative to book value; P/e multiples are high and rising; price:book value ratios are as extended as we’ve seen them since the late 90’s and the early first years of this century.

Government borrowing ratios compared to GDP estimates are historically wide; wage pressures are being felt everywhere and margin usage is egregiously extended… and yet prices move higher.

So, we are left with the singular notion that this does indeed remain a bull market, but risking abject, disdainful redundancy, we shall again iterate that we are to err bullishly of equities in global terms but we needn’t be… nor should we be… aggressively so. Modestly long; tenuously long; deer-in-the-headlights fearfully long…. That’s what we are or should be as of the moment and that’s all we shall advocate."