David Stockman’s infamous “Sell Everything” call back in early November was another classic 2016 scrapbook entry in my collection of dogshit analysis from experts and pundits this year. However, he came out to defend his call citing “Sucker’s Rally” and urges listeners to sell everything yet again.
“This 5 percent eruption is meaningless. It’s some robo machine trying to tag new highs,” Stockman said Tuesday on CNBC’s “Fast Money,” in a dismissal of the S&P 500 rally.
“I see a recession coming down the pike in 2017. The stock market is going to go down and it’s going to stay down long and hard because, for the first time in 25 years, there’s nothing to bail it out.”
This echoed the initial call Stockman made Nov. 3, when he urged investors to sell stocks and bonds before the presidential election.
However, since the Nov. 8 election, the Dow Jones industrial average has gained 4 percent en route to surpassing 19,000. Additionally, the S&P 500 and Nasdaq also hit record highs in the same time period, gaining 3 percent and 4 percent, respectively.
Yet Stockman, who was director of the Office of Management and Budget under President Ronald Reagan, reaffirmed that markets are heading for disaster.
“My call stands. Sell the stocks, sell the bonds, get out of the casino,” Stockman explained to CNBC in an off-camera interview. “Bonds have already cratered by nearly $2 trillion worldwide and have miles to go. This isn’t a rotation into stocks, either. It’s the greatest sucker’s rally ever.”
I bought $TEAM calls and going after $GOOGL at $770.
In closing, I’m mostly thankful to those of you who still drop in to read my nonsense and contribute to the cause. Enjoy the time with family and I’ll see you on Monday. Happy Thanksgiving.
As a reminder, the last Boot Camp of 2016 is just a few weeks away. Reserve a spot here.
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How long will morons proclaim the stock apocalypse is imminent? For as long as it takes to become correct, and then they can say “I was telling you rubes to sell stocks.” I can respect those who are fully leveraged bears. At least they walk the talk. I read a yahoo finance article headline today saying the Wise Masters have used their arcane, expert knowledge and wisdom to predict a coming correction, because Trump. Yeah, they were so right last time (Trump win anywhere from 4% correction to 13%.) It makes me want to fully load up on the long side.
When they stop predicting it is when you start to look for it.
For new client money would you keep most of the powder dry or close your eyes and hit the Buy Button?
What are you buying?
Some broad-based ETFs including IWM-N and mid-cap U.S.and boring stuff like GE and some APPL.
Yeah, wouldn’t buy an index here…even with an enemy’s money.
But then again, I wouldn’t buy an index period.
“even with an enemy’s money” , best clear answer possible !!
Problem is that his enemies are the bears. So, I dunno what that means??
thanks for all you do OA
Bought December $CRM calls here, and started a position in $NMBL shares at $8.05.
I salute the guy for at least sticking by his dead wrong position, unlike the guy who waits until after the terrible earnings report to downgrade. In spite of his heroic obstinence, it’s hard to fight the massive wave that is coming, even if our gracious and gentle President Elect can only cram through half of the stuff he’s promised. I’ll be ready for the crash though … eventually. As OA said in my favorite line in AHWOA history, “You made some good points … you were just early.” I hope to be on time.
@Frog, in response to your post on the last thread, OA was discussing the Trumpster in AHWOA regularly, but also posted it on the blog with the Expect the Unexpected …
One of the very many reasons that After Hours is a worthy service to join. The blog touches on roughly 0.10% of what is discussed After Hours. A person like you that strikes me as the type that would have interest in the more behavioral/sentiment components of trading and the markets would like it especially, I suspect.
Thanks, TJ.
Damn it, long next weeks’ $TWLO. Done buying for now.
Happy Thanksgiving everyone. May the markets be far from our minds and working in our favor.
I am thankful for decent stock only volatility in both directions. The VIX @ 12 ish is a trading paradise.
Eyeing gold miner leaps here. Am I crazy?
Got an order in to buy $PVG at $6.
I don’t think it gets there, but time will tell. Miners not following gold lower is a divergence that usually precedes a turn…
OA, thanks for putting up with me thru the year. Lol. Have a good thanksgiving.
Added to twlo just now at $36.08
OA – would you classify EEM as Aversion?
Eem been in the shitter ever since election. Don’t see that changing anytime soon as long as dollar stays elevated
Is the dollar supposed to stay elevated?
By he way, the question was for the zen master of fucking stocks…the dude that has called every turn.
No.
Why not? What differs?
Draw it out for me.
http://charts.stocktwits.com/production/original_67785083.?1479929251
Nice. So let’s focus on the lower half of sentiment chart. Specifically the head and shoulders that happens. How would you draw that out here?
Aha….so would the dip several months ago (June) be the right shoulder or aversion?
That’s why I said no, but beauty is in the eye of the beholder.
I hate arguing over what nickname should be given to price action. I’d almost prefer to give them my own names.
Copy and paste the link, clicking on it doesn’t work.
I have added 8% to my 401K this month following your nonsense advice – it would have been more if I hadn’t been a chicken shit and only allocated 25% into that triple oversold signal – taught me a great lesson, in a long line of great lessons. I am thankful for the many market pontifications that you go on in AHWOA – this is where I get the most learning – the stock picks are great, but I truly value the knowledge that you pass on.
Thanks to you and RC for keeping this place a finance blog. Enjoy the holiday.
I’m just getting going on investing again. Had a horrible stretch from 2014 to now, giving back 3/4 of my gains from 2009. I’m really lost to be honest. It seems like every single gain I get is pissed away in an instant nowadays. Has anyone else been experiencing this still?
I took a month or two off to cool my head.
Best idea I can come up with right now is GOOGL. I like those dry bunkers but I know I’ll pick the one that gets shit canned.
Lost? No. I’ve had a decent map in play since fall last year. Had a couple tough months, but an awesome year overall.
Yeah I’ve just been in a bad state of mind. Kept getting these big winners then get smacked down immediately.
Been there – sucks man. I took a long break and changed trading habits when I started up again. Much more disciplined now, better in the long run. Also found I’m not living on a screen (I’m a very part time trader) anymore or trying to absorb market info all day, which my wife definitely appreciates. Recommend if you’re making the same mistakes over and over again (ie, if you’re seeing the same kinds of losses), stop trading and reassess.
Don’t sell everything, just TWLO.
I bought more for Friday.
TWLO is one of those companies that you really have to believe in in order to stay invested. Most folks have baled and re-baled out. So now they have to entice new investors and the only way to do that is to put up some decent numbers.
Fidelity prop algo ranks it at 2.7
theflyonthewall keeps track of TWLO for some reason and posts constantly
What’s not to believe in? They destroyed their earnings numbers last quarter. Stock didn’t move much due to the revaluation of all the social media stocks. Their client list includes all the most used apps such as Uber, WhatsApp, etc
Unless you own >=2000 shares don’t worry about it. Let it ride and see what happens. Obviously a lot of traders don’t have the patience. Go on Twits and listen to them moan about not making enough money fast enough….
While I love the name Twilio. What the dilio with the constant talk about the stock? It had a nice run after the IPO, but now fundamentals take over.
Has Stockman ever advised people to buy stocks? Seems to always be bearish, from what I’ve seen of him.
That’s a strange name for him– Stockman– the guy who hates stocks, LOL.
CNBC this morning – everyone is bullish, so that is a contrarian indicator to sell the rally. Also pointed out that cash on sidelines for money managers dropped from 5.8% to 5.0%
If you want to get in on the Oil trade use the overnight lows as the stop in the CL_F 45.18. I know it’s a couple of points but try the USO if it’s to rich but definitely good risk/reward IMO. At resistance right now on the lower time frame so you may get a small pull back to load up if interested.
I take it you think oil rallies?
Short FOSL… two buck stop.