Long time bear Michael Darda has turned very bullish. I don’t feel good about disagreeing with him….
Mr. Roche is the Founder and Chief Investment Officer of Discipline Funds.Discipline Funds is a low fee financial advisory firm with a focus on helping people be more disciplined with their finances.
He is also the author of Pragmatic Capitalism: What Every Investor Needs to Understand About Money and Finance, Understanding the Modern Monetary System and Understanding Modern Portfolio Construction.
He will be wrong, you will be right. Massive consumer deleveraging coupled with continued job losses will trump everything he said. And, why anyone would still listen to that other blind squirrel who always chimes in as some sort of emerging markets know it all, is a total mystery.
Sure there may be growth…only if inflation rises too. Which everyone knows rising unemployment+rising inflation=stagflation. Which does not equal real growth. There is absolutely no way we are going back to how our country was 2 years ago. Ever. Debt=prosperity is dead. Our government and consumers have too much debt to sustain it, and foreigners don’t have the stamina to support it.
You can be bullish on the markets even as the economy sinks further into a recession. It may sound unreal but its happening right now in the last 3 month rally. Both Darda and TPC can both be right….though if I had to use logical reasoning, I would side with TPC that there is more pain to come.
Other than rising stock prices and bond yields, I don’t understand which data he focused on to reach his conclusions.
Are house prices going back up? (Even with higher bond prices and the next wave of NOD/foreclosures coming in the next couple months?) Are jobs bouncing back?
Homey says, “I don’t think so!”
I enjoy reading your website and your general market outlook but this segment threw me at first as it looked like you reversed your position or at least had doubt in the face of what Darda was saying. After watching the clip it had no date so I spent a while looking for it – this was from April 28 when the consumer confidence jumped but the case-Shiller had an 18.6% drop. Please post a date if you can and I’m wondering why you would let what Darda said almost a month ago affect you after Friday’s selling and failure to rise above resistance. We are IMO in overbought territory and well overdue for at least a small pullback. Darda himself said in April he expects another low in June to Oct and a leveling off BUT he had doubts as to the sustainability of any rallies if the fed is behind it by printing money. That’s not very bullish to me. Thank you for your continued market commentary and perhaps I misunderstood your doubts in this article. The link points to the news I believe Darda commented on back in April for other’s trying to find it.
Comments are closed.