Anyone over the age of 35 remembers the market crashes of yesteryear — the malevolent crashes of a comical nature that ruined so many people and their households. Kids getting tossed out of their lambos — because they’ve been repossessed. Wives being told her Hermes collection needed to be sold on Ebay, in order to pay for the boat. Husbands being told the boat had to go in order to pay for the mortgage. The bank telling everyone to GTFO because the house was being foreclosed and they intended to sell it.
It was bad.
The recent downturn forced many people my age and older to cash up. Now, according to Bank of America, those same people are assed out.
Bank of America’s Merrill Lynch’s latest fund manager survey, which gauges where global pros are positioning, showed the biggest net overweight position in cash since January 2009, just two months before the market bottomed and set up the longest bull run in Wall Street history.
Sentiment moving to extremes has been a reliable contrarian indicator for market historically. The January stock market rally coincided with a cash allocation of 4.8 percent, which is above the 4.5 percent threshold that Bank of America considers a bullish sign.
Markets are spinning higher and nothing can stop it. Oil is up. Junk bonds are up. Industrials are leading the way, optimistic about a China deal.
I have no warnings for you and only happy tidings. Go correlate with the market and make some money.If you enjoy the content at iBankCoin, please follow us on Twitter