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Point-Counterpoint – Market Gurus are Asking the WRONG QUESTION

Here’s my formal Bear Chat response to WP’s article:

I often look at the 10-year rolling return and related components at the Crestmont Research site here:

What the Fed/CB’s/Treasury have accomplished is an essentially freezing of the secular bear market, which really is a secular decline in the PE ratio from it’s bubble highs to it’s (normal) lows.

So, for now, PE’s remain elevated (although not in bubble territory) with the massive flood of liquidity that is keeping everything afloat.

So, for now the stock market is relatively safe because it’s floating on a sea of liquidity that is very unusual for a secular bear market.

So, any normal secular bear market strategy is useless because the liquidity is counteracting what is a normal steady decline in stock market valuation and I really don’t know how it’s going to play out here.

I have no idea whatsoever.

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