JonLaw wrote:The fundamentals have been working quite well over intermediate and longer timeframes since 2000 and I expect that they will continue to do so until the debt mess is ultimately resolved through either default or extremely severe inflation.
As long as there is an indirect $23 trillion bid under the stock market, I would expect the technicals to be more accurate in the short run. A switch was flipped in March 2009. I have only taken losses in short funds since that point.
I'm not interested in betting against the market in this environment. We already had a market crash/financial panic and the first recession, of what could easily become a muli-dip recession, is in the process of ending. The odds seem to favor the longs, so I am speculating accordingly.
I see no reason to bet against this market in the short run until I see signs of a significant technical breakdown.
Your statement describes exactly how most traders operate and how most traders probably should operate (I should add most of the time!). Basically it is to accurately gauge which way the herd is moving at the present time and to move with the herd in that direction.
When somebody is shorting into a high as I am doing (and have done in the past) they are speculating that it is necessary to take a position in advance because something so unexpected and sudden is likely to happen that it will be impossible to adjust to that "in the moment" using standard indicators.
It seems the entire herd is on board for further gains in the stock market or at least no sudden losses near term (including - finally - most here at the most bearish forum on the planet, though many have just dropped out of sight). As I've acknowledged, that doesn't mean the herd is wrong. But my preference is to follow the more nebulous and uncertain (near term) outline of history rather than the probabilistically more certain idea that what happened yesterday or since March will continue today.
In other words, getting back to the basics of the generational theory, it seems to me that the Strauss and Howe Fourth Turning catalyst is close enough over the horizon that I want to be positioned for that. What it will be and when it will be, I don't know. Nobody does. I think your opinion is that it has basically happened in the financial area and you could be right. For reasons I've stated, I think a much bigger blowup is coming.