The stock market is setting new all-time highs today.
Exactly five years ago today, the U.S. stock market began an epic bull market run that continues today. The S&P 500 is up 180% during that period.
Along the way, many stock market watchers turned bearish. Some have been bearish the whole way.
While their forecasts may have been based on legitimate concerns, the bears were just dead wrong. The bottom line is that stock prices — for whatever reason — went up.
Last fall, some of the most vocal “perma-bears” voiced concerns that we were in a stock market bubble. With that in mind, many actually warned very clearly that we could see stock prices go up.
So, traders who bought stocks on that are probably doing well.
Here’s are some quotes we’ve heard since last fall:
- John Hussman: “…we should neither expect, rely or be shocked by a further blowoff…”
- Jeremy Grantham, GMO: “My personal guess is that the U.S. market, especially the non-blue chips, will work its way higher, perhaps by 20% to 30% in the next year or, more likely, two years…”
- Richard Russell: “I continue to think that this bull market will end in an upside explosion.”
- Bob Janjuah, Nomura: “I still see end Q4 2013, through to end Q1 2014, as the window in which we see a significant risk-on top before giving way, over the last three quarters of 2014 and through 2015, to what could be a 25% to 50% sell-off in global stock markets.”
- Marc Faber: “They (US stocks) may go up another 10%, maybe even 20%, but the risks have increased significantly and I don’t think equity investors in the US, aside from a short-term trading opportunity, will reap very high returns in the future.”
These folks continue to sound warnings about the stock market.
Earlier today, Societe Generale’s uber-bear Albert Edwards provided an update, which probably captures some of what these other bears must be going through.
“Readers sometimes ask why I see the world so differently from the consensus,” he wrote. “Are my strident warnings of doom merely attention-seeking because something happened to me in my childhood? — a dysfunctional relationship with one’s mother often explains such perverse behaviour in adulthood. Nothing substantive came out of the many counselling sessions I’ve had over the years, although I do vividly remember one counselor stopping the session and breaking down as I was relating my particular personal problems at that time. I did think this was a bit much – after all he only had to listen for an hour a week. I had to live it.”
It must be challenging being called crazy all the time.
But that’s not to say they aren’t right once in a while.