Some Market Commentary

[bmichaud]

Some interesting commentary out this morning. Attached are a weekly market commentary from James Investment Research (a mutual fund manager frequently cited on CNBC) and John Mauldin's "Thoughts From the Front Line" from 11.25.11 (both commentaries are free, so shouldn't be a copyright issue).

 

JIR has a set of over 100 "risk indicators" consisting of short, medium and long-term market indicators. Currently their short and medium term indicators are very strong (they are bearish long-term, believing we are in a secular bear) and would recommend adding to equities here in the short term. This lines up nicely with Moore's essay by Adam Hamilton that says things are oversold and due for a major rally.

 

Mauldin continues to cite the potential banking sector contagion from the European banking sector as the largest risk to the global economy. Highly recommended reading, IMO. Great commentary on how crises happen with a bang after gradually escalating - i.e. risk reduction should happen well in advance.

 

 

http://www.businessweek.com/news/2011-11-28/grantham-calls-profits-freakish-that-doll-says-are-here-to-stay.html

 

Interesting bull v. bear commentary with Bob Dole (perma bull) versus Grantham (some would say perma bear) regarding the sustainabiilty of current profit margins.

JIR_Market_Comment_11.28.11.doc

John_Mauldin_11.25.11.pdf