I love that stocks are up 70% from their lows, even with all the huge problems it will take us years to dig out of. And I know that “a bull market climbs a wall of worry” – yet I am worried.
From “Breakfast with Dave” (David Rosenberg’s daily comment):
With the equity market 70% off its lows, we have a mere 23% bearish sentiment reading on the AAII survey (American Association of Individual Investors), a level not seen since four-years ago. Imagine that at the March lows, bearish sentiment on this survey was running at 70%. Now it is 23%.
Looking at the Investor Intelligence poll, the bearish sentiment is all the way down to 16% (the lowest since April 1987). At the March lows in the market, 47% of the investment newsletter editors were bearish. And for the traders, we see that Market Vane bullish sentiment is now at 57%, which is the highest since November 2007; at the March lows, the reading was 35%.
☞ When “everyone” is bullish, it is often a good time to take some gains.
INFLATION, INSHMATION – ECONOMIZE!
Amie H: “I like the chart you posted with 1999 vs 2009 prices, but I think there is another point to take – that with smart shopping and living you can have reduced your overall costs in ways that weren’t as easy in 1999. For example: New York Times and Time Magazine – I don’t know anyone who has the same number of subscriptions they maintained in 1999. News and other information is in such abundance on the net that it just isn’t necessary. Total per capita spending on periodicals has got to have decreased. Disneyland ticket – You can now get a free ticket by volunteering a day with the new give a day, get a day promotion. Last year you were able to go free on your birthday. And Six Flags Vallejo will sell you a season pass for $49.99, an amazing deal if you use the park. NYC Summer YMCA Membership – While I don’t know what brand of cheaper workout facility has popped up in NY, out here in CA I pay $19/month at Fitness 19 and my family members pay $15 each. The cost of going to the gym is a lot less than I was paying in 1999. ATM Transaction Costs – I don’t go to the ATM anymore, and I bank at a small community bank where they know me, don’t put three week holds on my checks and don’t charge me fees. I’m paying less than I did in 1999 for banking services. Cheerios – $5.15/box??? What elite grocery store is that in? I sometimes buy my dry goods at Target and don’t pay over $3 for any cereal, many are as low as $2 and this is not for the small boxes. Ditto the gallon of milk. I buy 2 for $4.50 or so. Eggs at $1.25/dozen, bagels $1.50/6. And the advent and availability of Target brand infant formula cut my formula budget in half. And when I do shop at my local grocery store – I buy what is on sale, and the prices are great. Stamps – still holding about a zillion forever stamps, so my cost will be 37 cents for at least the next few years. Average cell phone bill – It may be up 23%, but just a couple of years ago we were paying 40 cents a minute to call Europe – an hour call once a week would be over $100 a month! – and now I have a Skype phone that has eliminated long distance and international calling charges.”
☞ This what I call grabbing economic life by the horns! You go, Amie!
Steven: “In the recent discussion around backup, I wonder if anyone has heard of Acronis True Image. This [recently much improved] program allows you to backup with an image, enabling you, in the event of total disk wipeout, to restore your entire disk with no need to reload the operating system or any of the applications on your system. Fortunately haven’t had to do this yet. But if there were a crash I have two separate True Image backups of my entire C drive. To be specific, I have two external drives and keep a full backup on each of them, with one stored in my safe deposit box and the other hooked up to my computer for regular update backups. Every couple of weeks I go to the bank and switch them out. In addition, I use Mozy just in case; however, remember that Mozy (and no doubt, DropBox, et al) are great but in the event of a full system crash one has to reload everything. Having had to do it a few times, I can tell you it is time consuming and easy to make a mistake and worse. TrueImage promises to mitigate that process. Has anyone else enjoyed this very practical product?”
Quote of the Day
In 1800, 75% of [an American's] working man's expenditures went for food alone. By 1850, that had dropped to 50%. Today it is a little more than 11%.~The Wall Street Journal, September 20, 1996
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