Now, look. The thing about predicting the future is that you can’t ever really be “wrong” if you don’t put an expiration date on your prediction.
The future is inherently indefinite, so as long as you don’t say “we’re going to see a catastrophic selloff/furious rally by [X] date,” no one can ever say your prediction didn’t come true.
Of course that’s cheating. We’ll all be dead eventually (except for me), and if your prediction doesn’t come true by the time everyone who heard it dies, then for all intents and purposes, you were indeed “wrong.”
But being “early” isn’t the same thing as being “wrong.” In fact, if you aren’t early, then you didn’t predict anything. You can’t “predict” the past.
So I hear a lot of “you were wrong” chatter not just about myself, but about anyone who had a bearish call on anything over the past year. The amusing thing about that is that we (me and anyone who was bearish) were in fact “right” in January of 2016 just like we were “right” in August of 2015. It’s almost like people who are bullish think the bears are “wrong” if stocks bounce after a selloff. By extension, in order for the bears to be “right,” stocks would have to go to zero and stay there forever.
With that in mind, I wanted to show you some charts that depict just how sure the bulls are about their equity long positions. Of course if you frequent these pages you didn’t need a reminder because you know that last month was the third calmest January in history as measured by the average level on the VIX. But even if you did know that, it’s still amusing to review some fresh visuals because they demonstrate the extent to which a whole lot of people are going to be eating a whole lot of crow if this turns out bad. Enjoy.