Avoid Linear Thinking In Asymmetrical Markets

Take Mr. Cooperman here…

“If this bull market is over, it is the first one that ended without a Fed tightening.”

He goes on to list a other reasons not to be bearish, but the sensible player would tune him out the second he made the above comment.  Why?

Well, Leon, it would be the first bull market that ended without a Fed tightening, sure.  It would also be the first one to have been underpinned by ZERO rate policy for going on seven years.  Leon, you can do better than that!

Here is the historical.  Yes, Leon, it would be the first time alright.  Like the first time a bull market, 6+ years on, has been attended by ZERO percent rates every step of the way.  As we have noted often in the past, the last 2 bull markets rose with a RISING Fed Funds rate until the souffle dropped .

irx and stock market (SPX)

I am making no bull or bear claim here, because the situation is not yet resolved.  But I am making a claim that CNBC put some cartoon on instead of  Fed lazy thinkers with some lazy analysis.

The policy behind the market is asymmetrical and so mental extrapolations should not be linear.

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