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NBR: James Stack Interview at Trader’s Narrative

NBR: James Stack Interview

Last Friday Nightly Business Report interviewed James Stack, the editor and founder of InvesTech Research. I found out about InvesTech some years ago after reading Fleckenstein rave about their insight. Since then I’ve kept a semi-close eye on it. To be honest, compared to the plethora of newsletters our there, it does seem to be quite good.

InvesTech made a bullish call at the 2002 bottom which won them a lot of kudos and I’m sure many new subscribers. Stack’s approach is a combination of fundamental, technical and liquidity analysis. He doesn’t outright make market calls but you get a sense of his timing by how he allocates his stock and mutual fund portfolios.

He was slightly early but adamantly bearish on the housing bubble and their stocks. Here is a chart that he has kept on his website and updated frequently:

housing internet bubble comparison.png

Here are some salient excerpts from the short NBR interview :

  • in the past 5 months he increased to 60% cash
  • the bull market is very long in the tooth
  • believes a cyclical bear market is upon us
  • flat yield curve means a high probability of recession
  • believes Fed will pause on August 8th meeting
  • historically, after the last hike, stocks don’t do well
  • he likes Pepsi (PEP) and Johnson & Johnson (JNJ)

If you prefer, you can watch the video of the Market Monitor interview here. But get a move on because it will be replaced by the next interview soon.

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3 Responses to “NBR: James Stack Interview”  

  1. 1 Market Participant

    Although it certainly looks like the Homebuilders are in a harsh downtrend. From a fundamental perspective many of them are vert cheap even if you reduce projected future earnings and growth.

    I’m a bit conflicted on this as I think the housing bubble has a way to go before it fully deflates, but I wonder if that complete deflation is already priced in.

  2. 2 Babak

    MP: yes, they are very ‘cheap’ and getting cheaper every day ;)

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