Today's note will include a short video update. Please click below to view:
So much gloom out there, yet the S&P 500 is up 12%
It is not an exaggeration to say investors just seem so gloomy. I don't have to look far. My twitter feed is full of doom and "don't chase stocks due to a looming recession." And it seems like every conversation I have with an average person believes the Fed is driving the US into a recession. The only cohort that is not bearish, in my view, are CEOs. In conversation after conversation, I find CEOs noting demand is holding up better than expected, but they are reluctant to see this as true for the overall economy.What is the implication? For me it's obvious. This really strengthens the case to buy the dip and expect stocks to continue to rise -- that is, if the national and consensus view is caution, then that means most are underinvested. Can consensus really be right if we have a trifecta of bearishness of: (i) sell-side Strategists; (ii) institutional investors and (iii) retail? The sell-side bearishness might be the most extreme I have seen in 30 years. Consider that at the end of 2022, only 2 Strategis...