hdas wrote: ↑
Fri Sep 14, 2018 1:32 pm
Another big hitter with solid track record expressing concern:
The investor said he is now about 25 percent exposed to the stock market. Tepper called the market "fairly valued" if the U.S. doesn't impose more tariffs on Chinese goods.
"I've taken down my exposure [to equities]," he said. "I'm just not sure what's going to happen with these tariffs. ... Our whole book we probably took down 30 percent at some point, the equity part."
Let’s see how his crystal ball works this time
Link: https://www.cnbc.com/2018/09/13/david-t ... nings.html
From Billionaire investors turn bearish as U.S. stocks hit record highs (Reuters)
-- Dated August 15th, 2016:
Noting the recent run-up in the benchmark Standard & Poor’s 500 index to fresh record highs while economic growth remains weak and corporate earnings are stagnant - George Soros, Jeffrey Gundlach, Carl Icahn and David Tepper were among billionaire hedge fund investors and money managers who slashed their long equity positions in the second quarter, according to regulatory filings.
All three major U.S. stock indexes ended at all-time highs on Monday, extending their record-setting climb of the past few weeks. The trailing price to earnings ratio of the S&P 500 is now at 20, a level at the high end of its historical range.
Gundlach, who oversees more than $100 billion at DoubleLine Capital, told Reuters last month, “The artist Christopher Wool has a word painting, ‘Sell the house, sell the car, sell the kids.’ That’s exactly how I feel – sell everything. Nothing here looks good.”
Gundlach has been selectively shorting stocks and has kept his overweight exposure in gold and gold miners.
Spot gold prices XAU= rose around 7 percent in the second quarter of 2016 to $1,358.20 an ounce, a two-year high and extension from the 16 percent rise in the first quarter - the strongest quarter in nearly three decades - as expectations for a U.S. interest rate hike faded.
At the time the article was written, the S&P 500 closed at 2184. The S&P 500 today is ~2905, or a whopping a 33% above where it was in mid-August 2016
! The gold front month future contract was ~$1336 on 8/15/16 (SOURCE
); it is now right around $1200, or ~10% lower vs. 8/15/16. At last as of right now, 2016 was a terrible time to reduce equity exposure or to start shorting the market.
Granted, some of these folks changed their tune after the 2016 presidential election, but the fact remains that, ~2 years after so many big names talked about pulling out of the stock market, their call remains bad. At the time, they didn't know how the next election would go, or how the economy and plethora of geopolitical stressors would evolve, but, then again, none of us do. That's the whole point of not putting much faith/reliance/whatever in the words of other investors who try to time the market. Sadly, we tend to forget all these incorrect bearish calls as time goes on. And the next time a bear market comes, the folks who made a bearish call beforehand get all but memorialized as great investors who say what few others could see coming.