Corporate Insiders Are More Bearish Than They Have Been In Decades

Below are some of the most interesting things I came across this week.

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Michael Santoli writes, “Fed Chair Warsh has invoked a tech-productivity miracle as cover to keep rates low, invoking the ’90s Greenspan era. Yet much more than tech drove the ’90s disinflationary boom: Fiscal conditions, demographics and globalization all helped. These are all pushing the other direction now.”

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Similarly, Bridgewater notes, “Surprise inflationary supply shocks in this environment are more likely to become the norm than an outlier. Exposure to real assets, particularly those likely to get squeezed by the build-out of AI and national resilience, will shape portfolios.”

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Christian Mueller-Glissmann apparently concurs, arguing, “During the 1920s, 1950s and late 1990s, innovation-driven stocks also became a bigger part of markets, the economy and investor portfolios. Portfolios now look too tilted towards innovation and not protected enough against inflation.”

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“Corporate insiders are more bearish than they have been in decades… the number of companies with net buying from corporate officers and directors, expressed as a percentage of all companies that had any buying or selling… stands at 14.8%. If that turns out to be the full-month percentage, it would be the lowest level in at least 21 years,” reports Mark Hulbert.

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Finally, Fidenza Macro writes, “Parabolic bull markets almost always resolve in prolonged bear markets. The more extreme sentiment, price, and leverage get to the upside, the bigger the hangover. When margin calls hit, that capital becomes impaired and rarely comes back.”