No More Rainy Days

As long as the crowd is right about 2011 being a fabulous year than there is not much to worry about. How prepared are investors if something does go wrong?
  • Margin debt is at $299 billion which is pre-September 2008 levels. NYSE net cash balances are negative $35 billion.
  • The VIX and put/call ratios point to a market that is not well insured. 
  • Short interest is at levels not seen since 2007. The shorts will not provide much support for the market.
An unforeseen event combined with these facts are a recipe for disaster. But we all know that doesn't happen when all the pundits are saying that 2011 will be rosy.

Investing is not only about preparing for the most likely scenario, but preparing for all possible scenarios. Few are prepared for anything to go wrong.

3 comments:

Anonymous said...

Come on Tsachy, your sounding like sour grapes everyday now. A little bitter for the bulls making money?

There are plenty of pundits that think the market will be flat at best next year. Your buddy Doug Kass comes to mind.

And I think, everyday, the bulls have their finger on the sell button, but until the trend changes...

Hey, here's a shout out to all the bulls with the rocks to stay long this market. Congrats.

Anonymous said...

Here...

http://etfdailynews.com/blog/2010/12/26/the-bear-will-return-in-2011-tza-dxd-sds-faz-skf-drv-spy-vxx-tna-fas/

Tsachy Mishal said...

take the other side of my trade if you think I'm sour grapes.