Back To The 90s? Get Ready For Crises Within A Bull, Sonders Says

Charles Schwab’s Liz Ann Sonders says she expects the bull market to roll on, but she wouldn’t be surprised to see some major speed bumps along the way.

Speaking at the Inside ETFs conference, Sonders said she wouldn’t be surprised if, within this bull market, we started to see financial crises rear their heads in areas like commodities and emerging markets, as was the case in the 1990s, Financial Advisor reports. She also said that “this might be the year Main Street feels better than Wall Street.”

Investment News reported, meanwhile, that Sonders said there “is a slightly elevated risk of a 10% correction this year”. But she doesn’t think the bull is done. “I have some short-term concerns, but I personally think the bull market we’re in now will be the best is our lifetime,” she said, noting that U.S. businesses “are sitting on a huge hoard of cash, which is at a level not seen since World War II” while inflation remains low. “The money is not multiplying and that has held inflation in check, but it has also kept economic growth low,” she said. “You don’t get an inflation problem when you have no velocity of money, but if we start to see velocity pick up, then I think we could start to change the thinking around future [Federal Reserve] policy.”

Sonders also says that valuations aren’t a concern yet, and that profit margins shouldn’t be a problem. “We know that profit margins are at or near all-time highs,” she said. “But unless you’re rolling over into a crash, it has not been historically a problem for the market coming off all-time highs in profit margins.”

 

 

 

How Walter Schloss Became a “Superinvestor”

While not as well known as fellow Columbia University value investors Warren Buffett and Benjamin Graham, Walter Schloss produced one of the best stock investing track records ever. And in a recent piece for Stockopedia, Rupert Hargreaves looks at how he did it.

Continue reading

The Real Reason Why US And Foreign Stocks Trade Leadership

Top strategist Kenneth Fisher says he’s not giving up on foreign stocks, despite the fact that they’ve lagged during the bull market.

Continue reading

Paulsen: Look Deeper at Valuations

Nearly six years into the bull market, the S&P 500 is trading at somewhat elevated but far from euphoric valuations. But in a recent note, Wells Capital’s James Paulsen says that doesn’t tell the whole story of the overall market’s valuation.

Continue reading

Lessons from 2014’s Forecasting Failure

What lessons can investors take from 2014? Don’t listen to short-term economic and stock market forecasts, says The wall street journal’s Jason Zweig.

Continue reading

Rosenberg Says It’s Very Difficult To Make Bearish Case For 2015

Top economist David Rosenberg — long a bear — is continuing along the bullish path he started on last year.
Continue reading

Dreman: Fed Creating “Financial Ebola”

Contrarian guru David Dreman says policymakers have created “a form of financial Ebola” that is threatening to wipe out the savings of many Americans.
Continue reading