Paulsen: Market Needs A Correction To Move Forward

Wells Capital’s James Paulsen thinks a much-needed correction is coming for the stock market.

Continue reading

R-Squared Indicator Says Market Could Get Scary

Wells Capital’s James Paulsen has been bullish — correctly — throughout much of the bull market that began in March 2009. But now, Paulsen says that a key sentiment indicator that has predicted many former declines is flashing a warning signal.

Continue reading

Paulsen: Wall Of Worry Weakened

Wells Capital’s Jim Paulsen says he thinks the market might climb some more, but then come back down amid headwinds that include high valuations and interest rate increases.

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

Paulsen: Diversify, But Don’t Ditch Stocks

Wells Capital’s Jim Paulsen sees some short-term weakness ahead for stocks, leading him to recommend shifting some money from cyclical stocks into more defensive sectors.

Continue reading

Paulsen: Cocktail of Factors May Spark Inflation Fears In 2014

Could 2014 finally be the year that long-simmering inflation fears boil over? Wells Capital’s Jim Paulsen thinks it just might be.

“In the last five or six years we’ve been worried about nothing but deflation and weak growth,” Paulsen tells Yahoo Finance’s Breakout, “so it’s very difficult to imagine that we might get to a point where we’re worried about an overheated economy again, but I think we’ve got a shot at that (this year).”

Paulsen says a number of factors — a new dovish Federal Reserve chairman, tightening labor market, rising factory capacity utilization rate, rising commodity prices — could combine to trigger inflation fears. “If you put all those together I think that could cause people to worry about overheating or inflation,” he says. To be clear, though, Paulsen is expecting only a small pickup in inflation this year. But he thinks that slight pickup could trigger bigger fears.

Paulsen: QE Has Had Little Impact

One strategist who likely is pleased with the Federal Reserve for finally beginning to taper its asset purchasing plan: Wells Capital’s James Paulsen.

Paulsen said last week at the Wells Fargo 2014 Investment Outlook conference that quantitative easing “has not had much impact,” except for there now being $3.5 trillion in bank reserves that has not reached the economy, the Las Vegas Review Journal reports. The Fed, he said, “should have stopped (quantitative easing) a while ago.” In buying up $85 billion in bonds every month, the Fed has essentially been “screaming, ‘we are scared and you should be too,'” he said.

Paulsen also said the “good news is the recovery is looking normal” and similar to recoveries that occurred in the early 1990s and early 2000s. He thinks the recovery has another five it six years to run. He did say that he expects a “mini-crisis” sometime next year because of the Fed’s taper plan.

The Validea Hot List is up 250% since its 2003 inception, more than tripling the S&P 500. Check out its current holdings here.