“Stay bullish.”

That’s the message from a lot of people. From anyone you care to ask, actually, with a few notable exceptions.

In this case, the crowd’ll be forgiven for their ostensible “madness.” “Stay bullish” has been the right call for months, and being wrong over that period was enormously costly.

I realize this a bit repetitive, but have a look at the chart below, which I stumbled into Thursday while trying to goal-seek something worth highlighting in Excel.

Simple? Sure. Poignant? Yes. And thereby worth a mention. The surge off the October lows counts as the third-largest four-month S&P bonanza in a decade, behind only the rally triggered by the January 2019 “Powell pivot” and the epochal rebound from the original COVID selloff.

If the idea was to hand Americans a windfall (on paper) in a bid to bolster Joe Biden’s flagging approval ratings (I’m not saying it was, but it might’ve been!), then mission half-accomplished. Janet Yellen and Jerome Powell did their part. They delivered the windfall.

But Americans were unmoved vis-à-vis Biden, preferring instead to bid up Donald Trump’s odds of retaking The White House, despite… well, despite the 91 criminal charges, a $454 million civil fraud verdict and the most inflammatory campaign trail rhetoric in living memory. (What can you do?)

The figure below shows BofA’s “Global Equity Risk-Love” indicator. There’s no use going into the details. Suffice to say it’s a contrarian gauge. So, “euphoria” can be hazardous to your financial health, even if, for now, it may be best to abide it.

This is a bit tautological (a lot tautological maybe), but BofA said that forward returns for stocks following long periods of euphoria “are not unpalatable in a bull market,” where “not unpalatable” means drawdowns tend to be less acute.

Ultimately, the bank’s message across several notes this week (including Savita Subramanian’s latest) was “stay bullish.” And yes, that’s an actual quote. “Global equities have had a scintillating start to 2024 [and] while the pace is not sustainable, we think the direction of travel is unlikely to be derailed,” strategists including Ritesh Samadhiya said, noting that aside from sentiment, “the other drivers of equity markets are all lining up in investors’ favor” from the economy to earnings to disinflation to prospective Fed insurance cuts.

The bank did concede that “if for some reason, price pressures refuse to budge,” staying bullish could be the wrong call. But that’s just an obligatory disclaimer by now, even as the incoming data suggests price pressures are in fact obdurate.

Writing on Thursday, Nomura’s Charlie McElligott alluded to Bitcoin’s summit push. “We have returned to a 2021-like world of meme stock and crypto degeneracy and speculation,” he said.