Perma-Bear Bob Janjuah Makes A Bullish Call

In a note this morning, RBS’s Bob Janjuah acknowledged his bearish reputation to emphasise a rare bullish call (via ZeroHedge):

I know I will always be labelled a perma-bear, and I have given up on the idea that (at least some) folks will ever understand/appreciate that occasionally I do make bullish calls (most notably early in 2009!). But for those who do follow/read my work in more detail I want to be crystal clear: If S+P closes above 1120 for the 1st 3 days of this week, 1150 and 1220 are next. If not – if we fall and close below 1120 on 3/4 consecutive closes this week/early next, then the odds are high of a resumption of a downtrend which shud take S+P to sub-1000 over the next mth or so.

Janjuah’s call is about gamesmanship, however, rather than real market value. He blames the unexpected gains on several delusions:

First of all, everyone thinks they can recover through exports, which is paradoxical.

Second, investors think inflation can erase all debts.

Third, that government can keep “pumping/printing/borrowing, without consequence, and for long enough to hide the private sector deleveraging/deflationary trends.”

Fourth, that the weather explains away disappointment in the jobs report.

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