Market Indicators - Investor Sentiment

Top 251. Feb 9, 2000 6:17 AM

» Mark_J - Gene...Kirk...

Nice job, Gene. Great summary and commentary.

Kirk...Kramer or Cramer?

Kramer: Funny hair, Seinfeld's buddy, the Assman, Cozmo, punched Mickey Mantle...

Cramer: Funny hair, got in trouble on CNBC, pay-per view website...

-- posted by Mark_J

Top 252. Feb 9, 2000 8:08 AM

» Gene - Kramer, Cramer, Smcramer

Kirk, gee I thought you meant Kramer so I waited by the phone for an offer. I thought it would be cool to head to NYC and hang out with him for a few days and maybe visit the real life Soup Nazi!

JJ Cramer @ thestreet.com vs Kirk @ S101 - no contest, I'll stay here for the super benes and the fact that their stock is down -70% last time I looked!

Gene

-- posted by Gene

Top 253. Feb 19, 2000 9:33 AM

» Gene - 2/21/99 - Investor's Sentiment Readings

Well, we are finally getting caught up with 2 week's worth of Sentiment Readings. We were SO involved with climbing the Wall of Worry and riding the Year 2000 Volatility Up / Down Roller Coaster, we were simply tuckered out! That Y2VUDRC ride is incredible - it has one shouting with glee on the Up move and then sobbing uncontrollably on the Down move with it's breath taking plunges, that we had no energy left to compose anything meaningful! What can we say other than "we are certainly living in interesting investment times".

We, here at Sentiment Reading Central are breathless as we leave huge swaths of sneaker tracks on the floor to the trading PC when we make the switch from Old Tech to New Tech then from Consumer I-Net to B2B Net, now over to Biotech, whoops, now take take a quick detour to Value, Health, Consumer and Commodity stocks in case the inflationary scare is real. Somehow I think the Brokerage & Discount trading houses are the only true winners in this and we are left losing sleep over it all if we allow ourselves to follow all those conflicting recommendations.

In addition, this following the Brinker Call to Cash Watch (but only 60% in case....) being conducted here and other sites in excruciating detail to see if canonization or damnation is to be his lot in the future has our nerves a bit frayed. Dont'cha just love it when someone like Playdate (hmmmm, too suspicious for me) tosses out a playful bon moot posting onto the table in declaring that "Bob was God" after 3 or 4 bad Fridays? And suddenly, it is like a piece of raw meat to folks here at S 101? But it certainly does get the facts out onto the table and for the rest of us in the meantime: "Check that Asset Allocation".

Adding to our worries also was the searching in our own portfolio for any wayward or bubbly like stocks or funds that Al Sweetpea would disapprove and be clobbered by his Humphrey - Hawkins testimony. This quite frankly had left us in a state of perpetual analysis, Fundamental, Technical and Bubblemanical that is!

Can you imagine all the Gen-X's, Hopefully Soon to be Retired Boomers and Latecomers to the 90s Bull run, who are 100% invested in Tech or QQQ, having become addicted to those +50% to +150% annual returns and are now trying to outrun his 70+ year old eyes as he tries to line them up in the crosshairs of FOMC policy while they are frantically calculating Net After Taxes Returns If I Sell Now?

I will most definitely be listening to the Bob Brinker shows this weekend as it should prove to be most interesting and I am "curious" to see if Bob has anything to say about this week's volatility or his recent call to cool it!

Well, let's look at the Sentiment Reading this week, oops methinks they registered their Bullishness increase BEFORE the above mention Greenpea Woodshed talk and Friday's interesting delayed reaction with a rise of +2.85% since 2/7/00.

Left from last posting > No matter how you slice it - one strong economy with a lot of fodder for all sides:

New Paradigm vs Bubble mania
Solid Growth vs Inflation is a building
Stock prices okay vs Rampant speculation
Good supply of workers vs ending supply
Wage inflation vs Prod for Productivity gains
and that is just for starters

The Rolling 4 week Sentiment average covers the period from 1/31/2000 thru 2/21/2000.

It is also important to remember that Bob Brinker considers a 70% ratio number to be neutral and is only one of his four main indicators with the other three being Economic, Monetary and Valuation. After noting a few questions about the 70% comment, I am researching my archives of Bob's newsletters as I remember copying it verbatim when a few questions arose.

From Barron's 2/21/2000, Page MW73:

Investor's Intelligence

Bulls = 53.7% Last Week = 53.2% Two Weeks = 52.3%
Bears = 26.9% Last Week = 27.9% Two Weeks = 29.7%
Corr = 19.4% Last Week = 18.9% Two Weeks = 18.0%

% Bulls/(% Bulls + % Bears)= Sentiment %

53.7%/(53.7% + 26.9%) = 66.63%

Rolling 4 week average = 66.05%

Weekly Bullish Sentiment %:

Week 02/14 = 65.60%
Week 02/07 = 63.78%
Week 01/31 = 68.17%
Week 01/24 = 67.08%
Week 01/17 = 67.37%
Week 01/10 = 64.84%
Week 01/03 = 67.07%
Week 12/27 = 64.41%
Week 12/20 = 64.43%
Week 12/13 = 63.83%
Week 12/06 = 64.87%
Week 11/29 = 64.16%
Week 11/22 = 62.61%
Week 11/15 = 55.29%
Week 11/08 = 52.70%
Week 11/01 = 51.70%
Week 10/25 = 51.57%
Week 10/18 = 51.11%
Week 10/11 = 52.70%
Week 10/04 = 56.67%

07/20/98 Bulls = 52% Bears 24% for 68.42%
10/12/98 Bulls = 38.5% Bears 42.7% for 47.41%

Gene

-- posted by Gene

Top 254. Feb 19, 2000 11:34 AM

» JenL_2 - WOW - Great Writing!

Gene.....
<img src="http://www.geocities.com/jeninvestor/smi..." width=266 height=400>

That was just Awesome!

.....Jen

-- posted by JenL_2

Top 255. Feb 19, 2000 1:07 PM

» Karin_ - Yes

Yes, I agree with Jen!!
I appreciate your posts here very much Gene!
Thank you for your terrific posts!

-- posted by Karin_

Top 256. Feb 20, 2000 5:10 PM

» Roger_Babson - Gene...

. . ., I echo the sentiments of others WRT your post.

In the interest of concision for Rande's sake, I'll remind you that when the sentiment regime changes from one characterized by a secular bull market for stocks to one dominated by secular bearish sentiment (which I think is coming), the focus on sentiment as a barometer for the market will change.

That is, instead of looking for relative levels of excessive bearish sentiment to signal a trend-following bottom and inordinate bullish sentiment to signal a top, all within the context of overall bullishness and rising stock prices, one will have to look for excessive levels of bullishness and bearishness in the context of very short-lived bear market rallies within a range of majority "bearish sentiment".

When the worm turns, the majority will become bearish and stay that way for the balance of the secular bear market that I expect to persist into the early 2010s.

In this environment, I realize this is heresy, but despite what we want to believe the indicators are screaming the end of a secular bull market and the beginning of a protracted period during which cash and fixed income will outperform the major indices.

If the Long Wave is still in force, which I believe is the case, per capita real GDP in 2010-15 will be lower than levels in 1990 through today, and stock prices will trend around 50% below current levels and not rise above todays nominal levels until after the late 2010s and early 2020s.

Is that short enough for you, Rande? Knowing you, I fear not.

Regards,

-- posted by Roger_Babson

Top 257. Feb 24, 2000 6:16 PM

» Gene - 2/28/99 - Investor's Sentiment Readings

Well, fellow investors, isn't this current market volatility more exciting than the market just plain going up across the board? Now we have to go out and EARN our returns the "old fashioned way" as that commercial states.

We have to admit that next to "Who Wants To Marry a Millionaire", this market is the MOST exciting show in town! The Real Big Question is similar to the one the Fox Network is asking - will this Bull Market marriage last for at least one more week for us investors. We also, freely admit that in spite of our love of the game, we have just about reached investment information overload.

After seeing just about every conceivable Investment pundit, Economist, Newsletter writer and unemployed Brokerage Strategist expound on CNBC and our local news we grew antsy. Why? Well we watched as the Dow retreated from 11,700 like a beaten Napoleon from Moscow, the Naz exploded like a Republican July 4th celebration and the S&P meandered and fell down like a drunken sailor, we simply had to settle back for a couple of days, gaze at our navel, review our Asset Allocation for the 8th time this year and make sure once again we were comfortable with it.

We certainly relished listening to all the jargon & chatter such as > A/D Line says The Big & Bad Cyclical Bear is Acoming or The Breath (Breadth of course) is narrow and bad, the 5, 10, 50 AND 200 MDA (moving day average) surly denotes a correction of "only -10% to -15% and then the all clear investment siren will be sounded Vs The Solid Growth and No Inflation Stalwarts telling us the Bull IS Alive and onward to Dow 14K and Naz 5K so hurl more $$ at it NOW, has certainly left us brain weary. But, at least after listening to all this noise and talk, we even learnt a few new "buzz words" about America's favorite new hobby which has allowed us to "sound semi-intelligent" when we finally emerged from our deliberations (fortified with an extra glass of wine) to declare, "We are Long Term Investors and we remain satisfied with our current Asset Allocation" to the cheers of worried friends and family!

Why the deliberations at this stage you ask? Well, when looking at my Asset Allocation, the big questions arise > how many of my chips do I put on +100% Black Return (obviously Internet & Tech stocks) or the plain +25% Black Return (A Boring Index Fund) to ride the momentum wave or is it time to place profits onto a -5% to-10% Red Return (Value Fund) or the -2% Red Return (GNMA Bonds) for those glorious future returns that surly awaits a smart and opportune investor down the road? Decisions, decisions, decisions.

It is certainly hard enough in normal times but I just plain get confused when I listen to what's his name from America's Favorite Investment Show over the weekend who is telling me to cash in some of the BIG BLACK CHIPS (denoting gains of +250% to +400%) that I won over the last 9 years, pack up, go home and rest up for a sunnier day. Meanwhile there emerges a a counter vailing opinion from a certain West Coast Internet Investment Entrepreneur and all around 'Frisco Bon Vivant (I am aware that Frisco term isn't quite kosher) is telling me no, no look here, follow the Skiing Engineer to Investment Valhalla as these here color charts will show you!

Well, as we look at the Sentiment Reading this week and see it is still in the mid 60's after the previous Friday downdraft, we are forced to conclude that this Bullishness is PERMANENT and we maybe out of a job if it continues or be forced to run cartoons in place of our Readings!

The Rolling 4 week Sentiment average covers the period from 2/7/2000 thru 2/28/2000.

From Kirk's SI Sources (Thanks):

Investor's Intelligence

Bulls = 51.8% Last Week = 53.7% Two Weeks = 53.2%
Bears = 28.6% Last Week = 26.9% Two Weeks = 27.9%
Corr = 19.6% Last Week = 19.4% Two Weeks = 18.9%

% Bulls/(% Bulls + % Bears)= Sentiment %

51.8%/(51.8% + 28.6%) = 64.42%

Rolling 4 week average = 65.11%

Weekly Bullish Sentiment %:

Week 02/21 = 66.63%
Week 02/14 = 65.60%
Week 02/07 = 63.78%
Week 01/31 = 68.17%
Week 01/24 = 67.08%
Week 01/17 = 67.37%
Week 01/10 = 64.84%
Week 01/03 = 67.07%
Week 12/27 = 64.41%
Week 12/20 = 64.43%
Week 12/13 = 63.83%
Week 12/06 = 64.87%
Week 11/29 = 64.16%
Week 11/22 = 62.61%
Week 11/15 = 55.29%
Week 11/08 = 52.70%
Week 11/01 = 51.70%

07/20/98 Bulls = 52% Bears 24% for 68.42%
10/12/98 Bulls = 38.5% Bears 42.7% for 47.41%

Gene

-- posted by Gene

Top 258. Feb 24, 2000 10:20 PM

» JenL_2 - Great Commentary!

Gene - Just like a Fine Wine ...

<img src="http://www.geocities.com/jeninvestor/win..." width=175 height=189>

...Your writing gets Better and Better with time!

.....Jen

-- posted by JenL_2

Top 259. Mar 4, 2000 12:15 PM

» Gene - 3/6/2000 - Investor's Sentiment Readings

Thanks to Jen,Karin and Roger for the kind words. We apologize for being late to acknowledge but this is one retiree who is so busy he can not figure out how he EVER squeezed work in!

WOW! Paraphrasing the Church Lady on Saturday Night Live, "Wasn't Friday's market action SPECIAL"?! That about sums it up as after a smidgen of good news (less folks working?!) sends the market into overdrive. Methinks she just wanted to go up and was looking for a reason. But when you think about it, there was a number of good reasons out and about. Quite a number of mergers to denote the restructuring play is still in place, advances in Wireless, Technology (1ghz PC!) and Biotech to continue the productivity portion and the 2000 earnings generally being favorable - albeit a little more managed than some care for. Certainly the market trying to broaden out a bit has played well also. It will be interesting to see how much follow through we have this week as the action last week look solid. Don't hold your breath but we only have a couple of weeks to another FOMC meeting, so watch for all kinds of pre-announcements from various Fed Governors.

After meeting with a number of friends last night and today, I can report that all my investor friends certainly seem to be in a better frame of mind this week than the last few weeks when I met for coffee today. That includes long term holders, frequent traders and the Brinkerites who are at 40% but with good Naz stock holdings were also wearing smiles. Even the Fixed Income folks were pleased with the yields on the 2 and 5 year Treasury rates now. The only ones that looked gloomy were the perennial Bears and those that went to 100% cash in a timing move. How sad it must be to sit around, grousing about everyone's good fortune (and some real big ones too!) in this market and praying for some rain to fall on the big parade. I am wondering that by the time any Bear market, (cyclical or secular), or even a recession dares to show its face, we will have spent our selves into exhaustion with this so called Wealth Effect and the boomers will have made it to early retirement!

We would be remiss if we didn't point out a couple of things to watch as a balance to the good news. The oil prices seem to be biting and they represent a "Fed hike or a tax hike" to the US consumer of $70 Billion according to Barron's. I would keep an eye on that Global recovery and our huge trade deficit with the rest of the world for any "negative" trigger events. And lastly, I always worry about the derivatives crowd at the various Hedge Funds, Trading Houses and Banks. They always seem to be able to precipitate a crisis when things are looking too rosy or we are at an inflection point!

Well, as we look at the Sentiment Reading this week and see it is still in the mid 60's after the previous Friday downdraft and we can only wonder where it will be next week if we have any follow through to the 3/3/00 move.

The Rolling 4 week Sentiment average covers the period from 2/14/2000 thru 3/06/2000.

It is also important to remember that Bob Brinker considers a 70% ratio number to be neutral and is only one of his four main indicators with the other three being Economic, Monetary and Valuation.

From 3/6/00 Barron's Page MW73 :

Investor's Intelligence

Bulls = 52.2% Last Week = 51.8% Two Weeks = 53.7%
Bears = 28.3% Last Week = 28.6% Two Weeks = 26.9%
Corr = 19.5% Last Week = 19.6% Two Weeks = 19.4%

% Bulls/(% Bulls + % Bears)= Sentiment %

52.2%/(52.2% + 28.3%) = 64.84%

Rolling 4 week average = 65.37%

Weekly Bullish Sentiment %:

Week 02/28 = 64.42%
Week 02/21 = 66.63%
Week 02/14 = 65.60%
Week 02/07 = 63.78%
Week 01/31 = 68.17%
Week 01/24 = 67.08%
Week 01/17 = 67.37%
Week 01/10 = 64.84%
Week 01/03 = 67.07%
Week 12/27 = 64.41%
Week 12/20 = 64.43%
Week 12/13 = 63.83%
Week 12/06 = 64.87%
Week 11/29 = 64.16%
Week 11/22 = 62.61%
Week 11/15 = 55.29%
Week 11/08 = 52.70%
Week 11/01 = 51.70%

07/20/98 Bulls = 52% Bears 24% for 68.42%
10/12/98 Bulls = 38.5% Bears 42.7% for 47.41%

Gene

-- posted by Gene