Matches
Rally skeptics abound.
I suppose that goes without saying. I'm not particularly fond of the "most-hated rally" label given that it ends up being applied to seemingly every rally at one stage or another. But I'll concede there are more reasons to distrust equities than usual, with the caveat that prices are never "wrong" in a strict sense of the term.
The risk of recession is elevated. In the US, yes, but particularly in Europe, and in China too, as evidenced by July's lackluster activity data
I’m not going to hate this rally — still bearing, but I bought some calls today. Loved Kolvanic’s arguments.
still bearish*
I think the more one is focused on macro and micro fundamentals and valuation, the more one can’t understand this rally.
The more one is focused on positioning, gamma, and mechanical flows, the more one can accept it.
I’m in the former camp, but I realize that the latter can dominate in the short term. I also think that few investors are good at every aspect of this game (I’m certainly not), and when markets are being driven by the stuff you’re bad at, the best you can do may be to just not get run over.
Respect stop losses, get neutral to what is hurting, and patiently work on the stuff you’re not bad at.
Parenthetically, there is also a “fundamental”scenario that is positive (Fed pulls off a soft landing, etc) although I’m trying to figure out how much upside is left in such a scenario.