Talking stock markets this morning with Matt McAleer in our shop.
Bullets:
1 These kinds of negative weekly momentum extremes have been profitable entry points in the past.
2. “The Trump bump has become the Trump dump” according to one editorial. Trump rhetoric is being dismissed by market agents as pure politics.
3. When election uncertainty is over markets will adjust regardless of outcomes.
4. The Lame duck session is either economy friendly or neutral.
5. Fed independence is confirmed notwithstanding Trump bluster.
6. Markets discounting worst outcomes from China-Trump-Navarro Trade War. This is an opinion (ours).
7. When things look bleak and markets show fear, buying cheap is a strategy for a professional. You need an iron stomach.
We have been buyers this week in our US ETF model taking cash from 18% down to 5%. Our international model has a 22% cash position, our tactical trend has a 20% cash position. As recently reported, our short term trading model is fully invested. We expect higher stock prices after this bleeding ends. Our outlook of over 3000 on S&P 500 by end of this decade remains intact.
David R. Kotok
Chairman and Chief Investment Officer
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