Up, Up and Away?

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This won’t end well–Chicago Slim

Only Barron’s semiannual Big Money poll of professional investors also is setting a record — for bullishness, that is. In our latest survey, 74% of money managers identify themselves as bullish or very bullish about the prospects for U.S. stocks — an all-time high for Big Money, going back more than 20 years. What’s more, about a third of managers expect the Dow Jones industrials to scale the 16,000 level by the middle of next year, notwithstanding a dismal week of selling that left the blue-chip index at 14,547.51 on Friday.

This spring’s survey is notable, as well, for the dearth of bears: A mere 7% of respondents are pessimists today, down from 27% last fall.

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A contrasting view:

A few reminders…

“Still Bullish! (Dow 13000)” – Barron’s Magazine Big Money Poll, May 1, 2000

The May 2000 Big Money Poll was published with the Dow Jones Industrial Average at 10733.91. The Dow had already peaked nearly a thousand points higher in January of 2000, and would go on to lose about 40% of its value in the 2000-2002 bear market, with the S&P 500 and Nasdaq faring far worse.

“Dow 14000?” – Barron’s Magazine Big Money Poll, May 2, 2007

http://www.hussmanfunds.com/wmc/wmc130422.htm

http://www.hussmanfunds.com/wmc/wmc130415.htm

7 responses to “Up, Up and Away?

  1. DanielLulumoonseethroughpants

    “Newsflash! We’re all going to die!” – Barron’s Magazine Big Money Poll, May 1, 1998

    So, John, you’re 100 cash or what?

    This is what I learned from these graphs: if you bought the index near the 11000 top at 2001 and then sold near the top at 14000 at 2007, six years later you’d still make a notional profit and beat plenty of fund managers around.

    If you bought at the top of 14000 at 2007 and held on until now, you’d still be in a far better position then plenty of guys out there.

    • I don’t understand your point, but I did answer on the next
      (most recent) post. You would have lost 40% of your purchasing power in Gold/USD.

  2. haha awesome charts. History doesn’t repeat but it certainly rhymes!

  3. Life is much less frustrating if you only select those opinions and evidence that support your views, isn’t it?

  4. Dear Panly:

    What view would that be?

  5. Interesting charts. If you put the vertical scales into a better scale such as a log scale, the visual story is much less dramatic. Those blips in 1986 and 1987 were just as large in their day, but since the graph’s scale is not well chosen, that part of the story can’t be well shown. If you have access to the source data, this would be a better picture to show for the long run blips in margin debt, which we are obviously experiencing now.

  6. There could be structural differences in margin debt–more hedge positions–so the charts could be misleading, but they could be an indication of rising risk. Be fearful when others are greedy.

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