One Bull Fears ‘The Silence Of The Bears’

Listen, “some” of you have been mean to Bloomberg’s Mark Cudmore “for the past couple of years”. And because he doesn’t name names in his Wednesday morning missive, we don’t have any way of knowing who those heartless bastards are.

But what we do know is that because the “ridicule” that’s spewed forth from their hateful word holes was tied to Mark’s “ever-present underlying bullishness”, we know that if he wanted to turn around and subject those people to some “ridicule” of his own, well he’d be well within his rights to do it. Because after all, being bullishness has mad everyone money.

But Mark’s not like “some” of you. He’s not going to crucify you for your constantly wrong bearish views because unlike a certain “very stable genius”, Mark’s not into cyber bullying. So rather than gloat about being right on his years-old bulls thesis, he’s instead going to “move to the other side of the boat” where that means turning cautious.


And the reason he’s going to do that is because he thinks it’s getting too crowded on the bull side and if everyone’s on the bull side, well that by definition means that he’s having to sit with those same naysayers who’ve been mean to him for “the past couple of years” and who wants to sit with those bastards, anyway?

“I’m suddenly nervous about global equity markets and it’s not for any good fundamental reason. My concern is primarily driven by the fact that, for once, no-one else out there seems worried at all,” he writes this morning, before reminding you that the MSCI AC World Index fell the most in five months and although “the losses are widespread, it seems nobody cares.” Maybe because we’re still riding the best streak in history:


He continues:

The Dow fell the most in eight months. Where are the bears? A 33% jump in the VIX across two days would normally have them very animated.


Then, here’s Mark being ominous:

Yet they are silent.

Yes, “they are silent”. It’s the “Silence of the Bears”…


I don’t know, it could be that the bears are “silent” because that’s what bears do when they’re trying to sneak up on your tent on the way to ripping your arm out of the socket and eating it while you bleed out on the forest floor, but I wouldn’t know because contrary to popular belief, I’m not an actual bear. I’m a meth dealer and a cancer surviver which I thought was clearly communicated in the pseudonym.

Anyway, Mark isn’t lovin’ this conspicuous lack of grunting and snorting and whatever other noises actual bears make when they’re pleased with themselves. Besides that eerie silence, he confesses he doesn’t have much in the way of evidence for suddenly becoming worried.

“A record percentage of Americans expect equities to rise in the year ahead, according to a Conference Board survey which goes back more than thirty years,” he goes on to say…


…before reminding you that he’s the one (not you) “who constantly reiterates that the three pillars — growth, earnings and liquidity — of the global equity bull market are solid and any correction is just that: a correction within an ongoing bull market.”

Right. And thanks to Goldman’s note out earlier this week, we know what those “corrections within bull markets” generally look like. They look like this (the ones not shaded):


So if this is a “correction within a bull market” you can expect losses to approximate 13% (assuming the drawdown is at least 10%) and more importantly, you can expect markets to retrace those losses in just 4 months.

Anyway, here’s the gist of Mark’s note:

Everyone seems to be on my side of the boat, and I want to move to the other side at least until others join me.

Or until the boat capsizes.


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2 thoughts on “One Bull Fears ‘The Silence Of The Bears’

  1. In-depth from Mark Cudmore from his 1-hour appearance last week on MacroVoices for anyone interested.

    Executive summary:

    dollar (turning bullish), volatility (rising), inflation (muted), US stocks (structurally bullish), eastern Asia (super-bullish), Kyle Bass on China (wrong & clueless), Euro (getting ahead of itself), bonds – nuanced. Well, all are nuanced except for emerging eastern Asia which remains a screaming buy for him.


    PDF transcript:

NEWSROOM crewneck & prints