Why Investors aren’t Being Aggressive Enough

Good missive today from Tom Sowanick of Clearbrook Financial arguing that most investors are filtering out good economics news, ignoring the Fed’s highly stimulative econo-therapy, and their portfolios are therefore not aggressive enough:

Consider that the recession mongers feasted on last month’s anemic employment gains of only 18,000 and then gorged themselves on the unemployment rate increase from 4.7% to 5%. Since then, initial unemployment claims have fallen every week and are currently at their lowest levels since last May. In addition, this morning’s ADP employment report came in at 130,000, versus the consensus estimate of only 40,000. This data strongly suggests that either last month’s employment report will be revised higher, or this month’s report (due out on Friday) will be stronger than the consensus expectation of 65,000.

Related posts:

  1. Jobs Report: Good! Bad! Hazy!
  2. Investors and Pollsters
  3. Where are Bill Miller’s Investors’ Yachts?
  4. More Bubble Trouble for Venture Investors
  5. Retail Investors Resisting the Market’s Siren Song

Comments

  1. larry says:

    1. Why take anyone seriously who uses the ADP employment report?
    2. The reason we are not being agressive is that we are fed a daily diet of crap from so-called pundits, i.e/. Cramer, Kudlow, Stein and Sowanick to name a few.
    3. Most everyone I know and myself have rebalanced, stuck our toes in the water, and have had them bitten off..
    This is a dangerous market for your capital. If he does not realize that, Sowanick should keep his mouth shut.

  2. franklin stubbs says:

    I love these guys who talk about investing as if the upside and downside risks are symmetrical.
    That’s only the case for professional money managers whose bonuses are tied to a benchmark — and whose limited retirement funds aren’t a part of the equation.
    Bottom line: the more precious your capital, the more attention you must pay to potential downside risk. Telling investors to load up carte blanche is just goofy.

  3. Toro says:

    After seeing the 375,000 print this morning on new claims, I wonder if the author is as bullish.