Comments on: Two Historical Factoids From David Rosenberg http://www.tradersnarrative.com/two-historical-factoids-from-david-rosenberg-2631.html Freshly squeezed market commentary & analysis Thu, 18 Mar 2010 16:11:34 +0000 http://wordpress.org/?v=2.0.2 by: Babak http://www.tradersnarrative.com/two-historical-factoids-from-david-rosenberg-2631.html#comment-40696 Wed, 03 Jun 2009 15:18:59 +0000 http://www.tradersnarrative.com/two-historical-factoids-from-david-rosenberg-2631.html#comment-40696 wayne, I'm listening and watching but nary a whisper - do you detect anything? :) bob, you noticed that too, eh? I wonder why Rosenberg picked 1950's as a cut-off point. wayne, I’m listening and watching but nary a whisper - do you detect anything? :)

bob, you noticed that too, eh? I wonder why Rosenberg picked 1950’s as a cut-off point.

]]> by: bob j http://www.tradersnarrative.com/two-historical-factoids-from-david-rosenberg-2631.html#comment-40687 Wed, 03 Jun 2009 14:12:03 +0000 http://www.tradersnarrative.com/two-historical-factoids-from-david-rosenberg-2631.html#comment-40687 If you go back to the early 1900's, then 40% rallies prior to recessions ending exist. Still, 40% is overbought on average. If you go back to the early 1900’s, then 40% rallies prior to recessions ending exist. Still, 40% is overbought on average.

]]> by: wayne http://www.tradersnarrative.com/two-historical-factoids-from-david-rosenberg-2631.html#comment-40682 Wed, 03 Jun 2009 13:25:05 +0000 http://www.tradersnarrative.com/two-historical-factoids-from-david-rosenberg-2631.html#comment-40682 Although we have never had a 40% rally in advance of a recession ending, the 40% rally only retraced about 1/3rd of the selloff. And 1/3rd to 1/2th rallies are typical of bear market rallies. Hard to make historical analogies when you are in uncharted territory. How many times in history have we had short term interest rates at 0, negative earnings, GNP at minus 05%, unemployment at 10%, govt spending and borrowing at unheard of levels? Also, I'm not sure that everyone agrees that we are in the last stages of a recession. But I cannot argue with his statement that we could be overbought here. In mid February, the three sentiment polls listed weekly in Barrons were all at historic bearish levels. Now they are back to 50/50ish, a level you would expect a bear market rally to take us back too. In uncertain times, sometimes it is best to listen to the markets for guidance. keep your eyes on 2nd quarter earnings. It is possible that the market is trying to tell us something that we do not know and if the S&P can post a 10 for the 2nd quarter, we can then start to put the 2008 4th quarter (-23) behind us and look for a 40 for 09 and there is the chance that the market is already putting that quarter behind us. Although we have never had a 40% rally in advance of a recession ending, the 40% rally only retraced about 1/3rd of the selloff. And 1/3rd to 1/2th rallies are typical of bear market rallies. Hard to make historical analogies when you are in uncharted territory. How many times in history have we had short term interest rates at 0, negative earnings, GNP at minus 05%, unemployment at 10%, govt spending and borrowing at unheard of levels?

Also, I’m not sure that everyone agrees that we are in the last stages of a recession. But I cannot argue with his statement that we could be overbought here. In mid February, the three sentiment polls listed weekly in Barrons were all at historic bearish levels. Now they are back to 50/50ish, a level you would expect a bear market rally to take us back too.

In uncertain times, sometimes it is best to listen to the markets for guidance. keep your eyes on 2nd quarter earnings. It is possible that the market is trying to tell us something that we do not know and if the S&P can post a 10 for the 2nd quarter, we can then start to put the 2008 4th quarter (-23) behind us and look for a 40 for 09 and there is the chance that the market is already putting that quarter behind us.

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