One More Reason

Last week I listed several reasons why the market has been rising. You can add this to the list. From the AP:
There's another sign that investors' confidence is returning: Last month they added money to U.S. stock mutual funds at the fastest clip in seven years. The year-opening surge also marked the first time in nine months that investors added more than they withdrew.
All told, investors deposited a net $21.3 billion to U.S. stock funds in January, the biggest monthly increase since a net inflow of $23 billion in February 2004, industry consultant Strategic Insight said Friday.
With these types of inflows it becomes less of a mystery why the market refuses to pull back. Mom and pops have not proven to be the best market timers but they do act in a very herd-like manner so these inflows can continue for a while. I would note that a lot of money has been exiting bond funds, specifically munis, and those markets seemed to staunch the bleeding on Friday.


Anonymous said...

Dawg, where r u?

Anonymous said...

Yeah but the mkt went up for almost 2 yrs straight as investors pulled money out. So what's the difference? Mkt now goes up if investors pull money in or out. Ponzi.

Anonymous said...

Got killed shorting WNR and still holding short in TA.

Giving back some of my gains lately.
Market is nearing a top so the plays are harder to find. I'm going to hold short and possibly get long a super bear etf like bxdd, but I think market is going up to 1340 ish.