Photo: National Archives
In his latest Bedtime With BTIG note, Dan Greenhaus passes on a crucial observations:Needless to say, clients of ours know that the current equity market rally has gone further than we anticipated, trading roughly 5% above levels when we moved to the sidelines to assess incoming data. While we have maintained a generally improving view of near term fundamentals, our reluctance to fully embrace this last 5% pales in comparison to the outright bearish views put forth in many client discussion.
For many, they simply don’t believe as much of this equity rally is based on “faulty” economic data, particularly in relation to one of two things; seasonal distortions skewed by the still lingering credit crisis and, perhaps more immediately, a warm weather which has biased many data points, specifically housing, to the upside.
With the market hitting new post-crisis highs, it feels like there’s exuberance, but then there’s the above, a statement that could have been made almost anytime since the March, 2009 market bottom.
People just don’t believe the whole thing, and so there are plenty more converts yet to come over to the optimist’s camp. The “wall of worry” lives.