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Looking Into 2011, Everyone Is Bullish On Stocks

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By Barry Ritholtz - December 22nd, 2010, 3:29PM

This is what I was referring to Monday on Fast Money: Too many folks are too bullish…


In the interview, Jim Bianco mentioned that corporate cash levels at nearly $2 trillion is not that far out of line with its historical average; Jim also challenges the argument that bond fund investors holding Treasuries and will be rotating back into stocks.

Lastly the interview noted that Goldman Sachs Asset Management Jim O’Neill’s forecast that stocks could gain 20% in 2011. O’Neill’s call is now nearly a consensus call.

PERMALINK
Category: Psychology/Sentiment, Video.

Comments

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4 Responses to “Looking Into 2011, Everyone Is Bullish On Stocks”

  1. Corporate Cash Has Been Piling Up Since 1982 | The Big Picture Says:
    December 22nd, 2010 at 3:59 pm

    [...] Bianco reports corporate cash is 7.3% — exactly what the historical median has [...]

  2. Corporate Cash: Top 20 Firms = $635 Billion | The Big Picture Says:
    December 22nd, 2010 at 4:05 pm

    [...] Bianco reports corporate cash is 7.3% — exactly what the historical median has been. PERMALINK Category: Analysts, Federal [...]

  3. Bill W Says:
    December 22nd, 2010 at 10:47 pm

    I think 2011 will be similar to 2010. The market will continue to oscillate between extremes in bullish and bearish sentiment. The glass is currently all the way full, “interest rates are rising because of strong growth, bond investors will be forced into stocks soon, the economy is starting to take off, profit growth is at record levels and the S&P 500 forward PE is cheap, cheap, cheap.”

    What will sentiment look like in the future? At some point this year we will talking about high commodity and borrowing costs squeezing profit growth, the PE ratio of the S&P 500 is expensive based on revenue growth, municipal and sovereign defaults, and another leg down in housing.

    Is the bullish take correct? Is the bearish take correct? I’m not smart enough to know. But when the market believes either, it’s time to bet the other way.

  4. ricecake Says:
    December 22nd, 2010 at 11:07 pm

    Since after the 2008 crisis, I started to watch a lot of the bloomberg and CNBC and listen to talks such as O’Neill and the like quite often. Not that these specialists are often wrong. But I noticed the key is where the 20% gain base on. The stock market can drop 20%, then gain back the 20%. So there is 20% gain. And O’Neill’s right. LOL.

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