Snap Out Of It - Thursday, Feb. 17

“If you have more than 120 or 130 IQ points, you can afford to give the rest away.  You don’t need extraordinary intelligence to succeed as an investor.” – Warren Buffett

Futures are in the red again this morning but just modestly, and while they’re off their lows of the overnight session, they’ve just recently started heading lower again.  Russia continues to take up a lot of the headlines, but unfortunately, there’s little in the way of resolution on the horizon.  Just released headlines quoting US officials suggest that Russia is moving towards an imminent invasion, and US Secretary of State Anthony Blinken will head to the UN today to address the Security Council.   No one besides Putin really knows when and how the situation will resolve itself.

Earnings season came to an ‘unoffical’ close today with Walmart’s (WMT) better than expected report, and given the multiple tape bombs that were dropped throughout the reporting period, investors will be happy to see this earnings season wind down.  It was a busy morning for economic data as well, and while most of this week’s data has been better than expected, this morning’s results were mixed.  

As of the latest survey, bullish sentiment dropped from an already low reading below 25% to less than 20% this week.  As shown in the chart below, the only other times that bullish sentiment was as low as it is now were in January and May 2016.  Just about every survey of sentiment these days, whether it covers the economy or financial markets, shows elevated levels of pessimism.  We realize there’s no shortage of concerns out there and you can take your pick as to which one is the biggest problem, but one has to ask whether these levels of pessimism are starting to get a bit extreme.