market folly

Market strategist Jeff Saut just concluded his visit with numerous European portfolio managers and his latest commentary summarizes their viewpoints. While he spoke with roughly 200 portfolio managers, it's interesting that most were bearish or very bearish on US equities due to fear of the debt situation, the dollar, and the debt ceiling.

While many PM's shared this view, Saut asked what their biggest fear was and here were their responses:

1. Fund managers that only use mutual funds & exchange traded funds (ETFs)

2. Investing is practiced in too complicated a fashion when it should be easy

3. A military coup in Greece

4. Inflation goes down instead of up

5. China sells half of its Treasury Bonds

6. Europe and the U.K. don't tackle their pension problems

7. There is blood in the street, but the markets trade higher

8. Most of the unemployed are un-hirable

9. The EU doesn't stay together

10. Water

11. Used to worry about Ireland, but don't anymore

12. Over-regulation

13. If the EU breaks up, what happens to the boom in German exports

14. The fact that only 11 residents in Greece declared annual incomes of one million Euros or more

15. Everyone is so negative that when the blue skies arrive they will be ignored


You can then compare and contrast the above viewpoints with that of UK hedge fund manager Crispin Odey who says that stockpicking is still working in his latest commentary.

Turning back to the US, Saut's recent missive also notes his skepticism around recent soft economic numbers as he thinks they are largely attributed to high commodity prices and the tragedy in Japan. Embedded below is Jeff Saut's full commentary:



You can download a .pdf copy here.

Be sure to also check out Saut's thoughts from mid-June that a trading bottom was near as well as some of his current favorite stocks.