market folly

Market strategist Jeff Saut is out with his latest commentary entitled "Rosebud" where he outlines his slightly cautious approach to the markets this month, expecting a pullback while citing impending Bernanke testimony and rhetoric about sequestration slowing the economy.

Saut also poignantly points out that,

"Reinforcing my cautionary view is a stock market axiom I learned from an old Wall Street wag in the 1970s that states, “When  they start running the ‘dogs,’ it’s time to begin looking over your shoulder.”"

He then goes on to cite that the 50 smallest stocks in the S&P 500 jumped almost 22% in the first half of the year while the 50 largest only gained 13.3%.

Saut's recommendation for the near-term is to raise cash levels.

Embedded below is Jeff Saut's weekly commentary, "Rosebud":




You can download a .pdf copy here.

If you missed his commentary last week, Saut sees a decline followed by a higher market by year-end.