Gluskin Sheff economist Dave Rosenberg has been warning of a double-dip for months. Today his investment letter sheds a little light on what the bulls are thinking and why they’re gathering some momentum.And he picked a good day. With the Europe stress tests over, and the BP oil spill winding down, it seems the big scare stories are coming out of the market.
Of course he’s still bearish: “From our lens, this is still a meat-grinder of a market. The bulls have the upper hand, but only until the next shoe drops in this modern-day depression and post- bubble credit collapse. The S&P 500 is still down 2% for the year, the Dow by 1%, the FT-SE and Nikkei by 11%, the Hang Seng by 5% and China by over 20%.”
Growing confidence in the emerging markets, especially Asia and Latin America, will 'decouple' this time around.
There is a renewed stability in the Eurozone debt and money markets - including successful bond auctions amongst the Club Med members.
The financial regulation bill is behind us and Goldman decided to settle - more uncertainty out of the way
There is a widespread refutation of the ECRI as a leading indicator and a conviction now that a double-dip will be averted, even though 85% of the date releases in the past month have been below expectations.
The earnings season is living up to expectations, especially among key large-caps in the tech/industrial space.
Bernanke is indicating that he can and will become more aggressive at stimulating monetary policy if he feels the need.
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