market folly

Market strategist Jeff Saut is out with his weekly commentary and in it he features some prudent commentary on being 'early' in investing and how the crowd tends to move long after the optimum time.  Saut also talked about the odds of a new secular bull market taking place:


"Last December I pegged the odds of a new secular bull market at 20%-25%.  I have increased those odds over the past six months to where I now believe those odds are at 45%-50%, yet few investors believe it.  To be sure, most participants think there has to be a 'feel good' environment for a secular bull market to exist.  The reality is that when that 'feel good' environment occurs, you are typically in the late innings of a secular bull market.  Ladies and gentlemen, the equity markets do not care about the absolutes of good and bad, but rather if things are getting better or worse; and, things are definitely getting better!"


His point about 'few investors believing it' is certainly worth considering.  Longtime readers may recall our investor psychology illustrated post that shows how bull markets are often born with dire sentiment, rally with disbelief, and then peak with euphoria. 

If Saut is correct, then one could potentially compare the 2013 market to the 'skeptic' portion of a rally.  After all, many investors have spent 2013 wondering when the major pullback will come.

Regardless, Saut's full commentary this week is worth reading and it is embedded below:




You can download a .pdf here.

For more from this strategist, head to Jeff Saut on the market buying stampede as well as his thoughts on investor sentiment.