Trader’s Narrative

Bears are cute and cuddly, until they tear off your head and feast on your carcass. The bear rampaging through Wall Street has taken the poor S&P 500 index down 52% at its deepest level. In case anyone is still keeping track of these sort of things, that’s off the charts.

It is a deeper loss than the bear market we last saw in 2002 in the aftermath of the technology bubble, and it is deeper than the “oil shock” induced bear market of the 1970’s, mercifully ending in less than 2 years from the top in October 1974.

The only bear market that lasted longer and created more devastation was the 1929 aftermath which sliced off 90% off the market’s valuation from its top by the time it was over.

It is the weekend and time to lick your wounds and get ready for duck the swats of this ferocious bear. Don’t forget to check out news.tradersnarrative.com for continous links to articles, breaking stores and analysis. Here are a few examples:

Buffett seems to have been taken off guard like many investors. Way back in 2007, well before the market topped, Berkshire Hathaway (BRK.A) wrote European style put options on the S&P 500 index and 3 other international indices for the next 15+ years. Does that mean that now, more than ever, the market is “cheap”? or did he make a massive blunder?

Fairfax’s Prem Watsa, who many liken to Buffett, recently removed protective hedges and for all intents and purposes went long the stock market after many years of forecasting doom and gloom.

Obama is reported to have tapped Hillary Clinton to be Secretary of State. Hmm…. that strikes a bell. Who was it that mentioned Hillary as the next Secretary of State two months ago?

If the embedded videos don’t work here are the links to them: Hillary Clinton and Recession Watch.