Media Appearance: The Kudlow Report 10.01.09
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I will be appearing on The Kudlow Report tonight to discuss the markets 200 point shellacking today.
I will be on CNBC at 7:00 – 7:20 or so with Zachary Karabell, who is an all around raconteur and nice guy.
To review our stance: Our early warning of a coming disaster — recall Dow 6800 — was made in 2006. We were long but miserable throughout 2007, and finally got stopped out of everything in December 07. Mostly cash all 2008 (see this). A long trade October 2008 or two, a bounce, then back into cash. We finally flipped bullish early March 2009, advising traders to close shorts. “There is a monster bear market rally coming,” we said.
We reiterated that Bullish view over the summer, and again in September.
Last week, we advised putting on some hedges (QID and SDS), writing: “While no one knows whether this will be a collapse or a mere shallow consolidation, I suspect the latter — but we have had a huge run since March, and our managed accounts have profits that require protecting . . .”
We currently own names a mix of big and small names like Disney (DIS), and Arch Coal (ACI) and Allied Irish Bank (AIB), as well as some smaller firms, like Continental Airlines (CAL), Bare Essentials (BARE) and Ulta Salon, Cosmetics & Fragrance (ULTA).
Should be fun!
~~~
UPDATE: Video is here
October 1st, 2009 at 5:33 pm
Sorry BR. I’ll have to miss it. I haven’t watched a minute of CNBC since last winter, and I’ll be en route to my Ultimate Boxing class, but will envision Larry’s face on the punching bag to get me motivated, so I’ll be with you in spirit.
October 1st, 2009 at 5:39 pm
Now we get the 20% retracement, Dow sub-8,000 here we come.
October 1st, 2009 at 5:47 pm
…accounts have profits that require protecting . . .”
nice going, BR~
October 1st, 2009 at 5:47 pm
BR u should have some sort of newsletter for those who manage their own money but are not traders.
October 1st, 2009 at 5:53 pm
Thanks for the outlook BR. One cannot argue with you success to date.
I have been following this blog and can attest that your calls are all legit – none of that newsletter reinvention stuff.
October 1st, 2009 at 6:04 pm
I can think of no better guest for Larry to have.
My DVR is set.
Thank you for the heads up.
October 1st, 2009 at 6:05 pm
I thought you’d sworn off Kudlow and were only appearing on Liz’s show?
October 1st, 2009 at 6:06 pm
The bear market rally is over. The shorts were cooked, the bear pundits threw in the towel, officials declared the recession over, and individuals started talking DOW 10,000. All those perma-bulls who declared “generational lows” will be forced to eat their words soon enough. I’ll start watching CNBC for fun now.
October 1st, 2009 at 6:13 pm
ok- let’s think about this- would you rather be here-
http://img3806.imagevenue.com/images/loc593/82881_liz_claman_892_122_593lo_122_593lo.JPG
or here-
http://media.cnbc.com/i/CNBC/Sections/CNBC_TV/CNBC_US/Bios/Kudlow_Lawrence/Cover/Kudlow_Larry_240×250_2009.jpg
hmmm . . .tough one
October 1st, 2009 at 6:24 pm
Everything is OK Montage
http://www.youtube.com/watch?v=qAQrsA3m8Bg&feature=player_embedded
This is fun !
October 1st, 2009 at 6:39 pm
Allied Irish Bank? TMBTF? (Too much blarney to fail)?
October 1st, 2009 at 6:52 pm
Barry,
I appreciate your blog and the work you put into it, especially as many of your posts deal with or insist on reality and not cheerleading. You’ve also made some good market calls and perhaps some of us would like to see more of those. I’m more interested in hearing your reasoning about such calls, even if they are after you have moved your paying clients into position.
I have a pet peeve, though. Stock markets do not move by points. An index or average moves by points, but what is much more important to measure is the percentage by which indices or averages move. The S&P 500, Russell 1000, Russell 2000, etc. are indices designed to reflect a portion of the American stock market. The DJIA is a populist average and is not designed to reflect the American stock market. Serious investors do not use the DJIA as a stock market benchmark any more and definitely should not cite DJIA points as meaning anything.
October 1st, 2009 at 7:18 pm
What, no tie?
~~~
BR: Last minute call — ties in the office, but nothing I wanted to wear . . .
October 1st, 2009 at 7:21 pm
OK, I popped a dramamine and I’ve turned on CNBC for the first time in months.
Karabell is leading off, I love him
OK all 3 are bullish – semi bullish
Had to turn it off when Kudlow said EPA will lead us back into a recession
I’m just waiting for the reconciliation between Trimtabs layoffs based on income tax receipts and the gummint figures based on birth/death and other unfathomables
October 1st, 2009 at 7:22 pm
200 points a shellacking? More like a love tap, wouldn’t even knock down Zach Karabell!
October 1st, 2009 at 7:28 pm
ULTA was a FusionIQ chart of the week. High five to the others who use Barry’s software …
October 1st, 2009 at 7:29 pm
You’re a bad ass BR. Praise.
October 1st, 2009 at 7:33 pm
All I can say is WOW! For a guy who perpetually posts bearish charts and graphs you sounded awfully bullish. Did you finally sell-out to CNBC? Hopefully they gave you top dollar.
~~~
BR: I flipped bullish in March, and have reiterated that market posture here repeatedly.
If you paid attention, you could have made money.
October 1st, 2009 at 7:37 pm
ahab,
I think astronomers call that a binary star system.
October 1st, 2009 at 8:26 pm
km4-
thx for the link- good stuff- all true
tanman-
i can look at that image all day- staggering- simply staggering
October 1st, 2009 at 8:37 pm
1: goldee the other 2 & mrBR: agree BigT – they sound bullish for the paper pile pushers – not so much for widget pushers in unUSA *
2: EPAc&t: love/hated the videographics running subliminally in the sidepanel – kiss kiss – puffpuffspewspew
3: FED oldies: gotta love the “we will exit safely” the smoldering theatre crowd
4: M&As work (for someone): last Saturday my roomie:watching his fav endless show SpongeBobSqPants: I hear wtf:they went loopie and told the kids to getout into a WorldWideDay of Play:I was so impressed I had to snap a picture to remember it *
* coda – gotta get out of the 2D world into the 3D world myself
October 1st, 2009 at 8:38 pm
Barry, just curious what you saw in March that led you to turn bullish.
There really wasn’t a compelling technical reason to get long in early March.
Sentiment was bad, but no worse than it had been.
Certainly the markets were oversold, but a persistently oversold condition is one definition of a bear market.
All I had on long was some energies that did clear double-bottoms in February. They mostly broke trendline in mid-June and therefore were sold.
October 1st, 2009 at 9:08 pm
GIANT PRINTING PRESSES OF FIAT CURRENCY FUELING TEMPORARY STOPGAP PROP UP COMBINED WITH OVERSOLD SCENARIO OF MARKET SENTIMENT
sorry for the all caps. Also:http://www.ritholtz.com/blog/2009/09/thursday-reading-2/#comment-218893
Barry has been at this for a long time and is quite astute to the vagaries of humans in market behavior.
October 1st, 2009 at 9:22 pm
I must say also, that he is very astute at hedging in all ways, not just in the market. As a recognized personality in the financial world, hedging your stance is akin to survival. Cryptic predictions and playing close to the vest ensure your ongoing status in this “what have you done for me lately?” world of financial advice. Just one bold call that goes the wrong way can ruin you! Luckily, fools commenting on blogs are not subject to this phenomenon. Read btw the lines and you’ll do alright with his data and advice.
October 1st, 2009 at 9:40 pm
Over years, I’ve made some pretty out on a limb, BUY EM / SELL EM calls.
Pay attention.
October 1st, 2009 at 9:46 pm
SDS – just a couple months ago some of the big brokers were taking these things off their sales lists.
Brokers calling their clients and trying to get them to switch. churning them. forced selling. maybe this wasn’t the best choice for your self directed ira.
the hardest thing about leveraged ETF’s is that you do have to time both sides of the trade pretty well.
October 1st, 2009 at 10:02 pm
yes you have. What I am saying people expect you to say BUY BUY BUY or SELL SELL SELL, at all times. Would not be prudent in your position of exposure. You are not a clown that has to make a bold statement at any and all times in this circus. You make such calls at very much the right times, in a diplomatic way, yet with integrity. Thanks for that.
That’s enough brown-nosing. I think the rollover is still the right idea, rather than consolidation BR. Think of the “shit, i got taken again!” psychology of the everyman in this second leg down, and the cascading effect of that emotion. I don’t know, but I fall back upon my analysis of the Shiller CAPE data and the fact that we are still higher than historical norms. E are not going to meet what has been envisioned, and the negative psychology degrading the ration will lead to abysmal levels. Outlier bottoms of CAPE hit 8-10. We have come up from the devil’s bottom in march at what, around 15? This was round 1. Plus the horrible employment situation. I don’t think I will have a job in a year myself. I am playing with my back against the wall here(yet many in my generation, including myself, have been doing so their whole lives).
As I say, fools commenting on blogs ar not subject to hedging a stance. I will hold to my doomsday prediction. Confidence is the main factor that will erode in the coming months.
Thanks again, BR.
October 1st, 2009 at 10:20 pm
Barry’s long call early March was enough to get me in to the market at just about the same time. I bought some heavily sold down bits and pieces and if I hadn’t been spooked in May I would be up a long long way. I’m no pro, the call was as clear as a bell. Bear market rally based on massive over sell, huge VIX number and good values available in general market. It’s been fun… Thanks Barry. I’m long the dollar and gold and holding on tight. BTW base currency is $NZ so being long both gold and the dollar does make some sense. Anyway everyone in America has an unavoidable embedded long dollar position that is backed by the US army…
October 1st, 2009 at 10:35 pm
That was a good segment, surprised you are all so bullish. Personally I think we are rolling over for a while, 15-25% maybe.
What was with the cutaway to Air Force One? All this nitpicking over the Copenhagen trip. He wouldn’t go if it wasn’t a done deal. Trip to Denmark, a little sightseeing, USA gets a summer games, what’s not to like?
But I hope Larry cuts away to every AF1 takeoff that occurs in the coming months. Heck they should schedule them during his broadcast just to give him something to do besides cry about his buddies on Wall Street having to downsize from 120 foot yachts to 90 footers.
October 1st, 2009 at 10:40 pm
Sometimes people just take profits after a bull run its normal it goes up and down but don’t sell now stay in for the long-run and if anything take advantage of the sell off by buying more!
October 1st, 2009 at 10:54 pm
The other guys was interesting….”No chance of a double dip…” I guess that’s why he’s an economist and not a trader….because traders know that “anything” is possible…..
October 2nd, 2009 at 12:21 am
wow for a guy who basically posts bearish pieces all day you long like a raging bull. you brought nothing up on the show about profits being down 27% last qtr and 22% this qtr and top line growth being awful.every bear from you to fleck to tice to grant has basically capitulated which is why i shorted last week. HEY BARRY WHY NOR GIVE SOME FOCUS TO THE FAKE BEAR MKT RALLIES OF 1930 OR SEVERAL OF THE 2001-2002 bear?and please explain how you get a 16-18 p/e on 2010 earnings with litle possibility of growth with the consumer gone?what about the new normal coming next year of 1-2% gdp growth with huge fiscal drag and tax hikes which means multiple contraction?
October 2nd, 2009 at 12:31 am
Pay attention? I read this blog every day. Once in awhile I can pick up a change in your sentiment, but there is no way I would come here expecting timely BUY BUY BUY or SELL SELL SELL calls that I can reliably trade on. But that is NOT why I come here since I have my own system to depend on.
I figure your lawyers have told you that you need to save the best for your paying clients. We in free-land get the crumbs, but the crumbs are still a relative feast… still way better than what you can find on BubbleVision, since you are inherently honest and can’t help but tell it the way you see it.
October 2nd, 2009 at 12:31 am
ZackAttack Says:
October 1st, 2009 at 8:38 pm
Barry, just curious what you saw in March that led you to turn bullish.
There really wasn’t a compelling technical reason to get long in early March.
Sentiment was bad, but no worse than it had been.
Zack, both of your statements are false.
From a technical perspective, the 666 low was the 61.8% Fibonacci retracement of the entire 1982-2007 bull move. I did not realize this at the time (it was later pointed out to me to someone who in fact did nail the bottom) so I missed adding at the March bottom (my next buy point level was 600 which obviously never hit).
From a sentiment perspective, bullish sentiment was at a 20-year low:
http://www.tradersnarrative.com/sentiment-overview-week-of-march-6th-2009-2332.html
But the most fascinating and historic reading comes to us from the AAII weekly survey. The latest American Association of Individual Investors (AAII) data shows what can only be describe as total and utter capitulation. As of Wednesday (March 4th, 2009) 70% expected the market to continue to fall, while only 19% continue to see better times ahead.
The only data point from the AAII survey that approaches this level of gloom is back in October 19th, 1990 when a paltry 13% of respondents were bullish and 67% were bearish.
The market was primed for an upside reversal, but to recognize that it was necessary to cut through the distorting gloom and doom fog that had ridiculous calls for S&P to go to 300.
October 2nd, 2009 at 1:34 am
I warned of an impending stockmarket crash back in *early 2007*
The primary trend remains down, is the current bear market rally ending ?
Yesterday’s action may be important.
October 2nd, 2009 at 3:13 am
Very nice segment. I think if you compare this one to others you’ve done in the past, you are now a “pro” at the CNBC box…
October 2nd, 2009 at 7:13 am
BR: I flipped bullish in March, and have reiterated that market posture here repeatedly.
If you paid attention, you could have made money.
reply:
———
Sorry, buy your advice is no better than anyone else’s. The only time I followed it I lost money. I could listen to Joe Kernan and get the same advice today.
October 2nd, 2009 at 8:18 am
That’s enough brown-nosing. I think the rollover is still the right idea, rather than consolidation BR. Think of the “shit, i got taken again!” psychology of the everyman in this second leg down, and the cascading effect of that emotion
——–
I think it’s going to get worse and I am quite negative on the quality of the economy we are going to have. Notice how I don’t mention GDP because so many factors could create GDP growth. I don’t care about GDP growth, I care about the quality of this growth for me and my children. Unfortunately, as the developed world population ages, there will be less and less concern for future generations. And the quality of the growth, is there is any, will be questionable.
All that being said, if you look at charts of every crash, there seems to be a constant. The market ALWAYS (maybe someone can prove me wrong on this) bounces back after a crash despite lower earnings and rising unemployment. Why? Probably because all those on the sidelines for some time finally jump in, because most people want to believe that a white knight in a shining armour will come and save us (government?) and lastly because many believe that many will believe the previous 2 reasons.
October 2nd, 2009 at 8:21 am
And when it bounces back, then you have to know when to get out again.
October 2nd, 2009 at 9:02 am
Yeah, but, Mike, how many people have ever looked at a 27 year chart when making a decision about an entry point? I saw no reason on anything out to a 10-year chart to be long specifically at 666.
As far as sentiment, AAII is just one thing to look at. For II sentiment, as I’m recalling, bearish % was 47% that week, compared to 55% back in December 2008.
Put/call ratio was nothing like what you should have seen at a major bottom.
Oscillators had been as low or lower back in the fall of 2008.
Insider buying was strong, but had peaked in November, 2008.
Mutual fund cash, the AAII and OTC activity did support a bottom, however. I just didn’t think it was enough.
October 2nd, 2009 at 9:53 am
Mutual fund cash, the AAII and OTC activity did support a bottom, however. I just didn’t think it was enough.
————
You’re waiting for the “true” trough. You’re never going to get good returns if you want to be 100% right.
October 2nd, 2009 at 10:27 am
3 out of 6 sentiment indicators, a chart with no support out to a 10 year scale… nothing better than a coin toss.
October 2nd, 2009 at 10:29 am
Understand, I’m not here to defend the fact that I largely missed the rally.
I’m just interested in what, specifically, BR was looking at when he made that call.
October 2nd, 2009 at 11:23 am
Claims by talking heads about the accuracy of their past predictions
are pretty meaningless. In general pundits say so many things it’s
not hard to find things that actually do come true and ignore those
that do not. Barry, how about publishing a model daily portfolio that
implements all your prognostications on a daily basis and then we can
see how much money you actually make or lose over short and long term
time frames.