It's great to be back on CNBC's Power Lunch discussing the huge one week selloff. Let me be clear, I'm a bull. I did some buying this week for the usual 5 and 10% corrections. But, we have some big issues that are both rare and serious.
First, we are contending not with a financial or political issue (those are easy!), but a change of behavior. Put another way, the cure to prevent widespread contagion is to stay away from other people. This will reduce consumption. Period. Second, I expect this to blow over by summertime. But if we get a few months of school closings and big events cancelled, it won't create pent up demand as I have been saying earlier this week, it will mute demand.
That is why I'm taking a rare step not seen since September of 2008 when Lehman went under. So, what exactly am I doing differently? I drew a line in the sand and will not consider any more dip buying until we see a full 20% correction on the S&P 500 - around 2750.
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