Stay the Course
There is more to Go, the market will get complacent and the new highs will roll.
The two pieces below show exactly what i think will happen, each time the market tries to correct the correction is aborted. investors will get even more confortable with the market. On top of that the credit cycle has more room to go. Banks are clean. All in all there is more to go.
NASSIM NICHOLAS TALEB: In the book, I have the story of a turkey that is fed for 1,000 days by a butcher, and every day confirms to the turkey and the turkey’s economics department and the turkey’s risk management department and the turkey’s analytical department that the butcher loves turkeys, and every day brings more confidence to the statement. So it’s fed for 1,000 days…
CHARLIE ROSE: Gets fatter and fatter and fatter.
NASSIM NICHOLAS TALEB: Fatter and fatter. On the day when its comfort will be at its maximum, there is going to be a surprise. There will be a surprise for the turkey.
CHARLIE ROSE: Yes.
NASSIM NICHOLAS TALEB: There will be a surprise for the turkey’s economics department, all those Ph.D.’s. Will it be — after all, there’s maximum (inaudible)…
CHARLIE ROSE: But it’s not a surprise for the butcher, is it?
NASSIM NICHOLAS TALEB: Not a surprise for Charlie Rose as well. Not a surprise for humans. It’s a surprise for the turkey. So the whole idea here is we are not to be a turkey.
Then once the S&P goes above 1900 the bubble
phase we’ve been looking for will be back on the table and the market will have
the guarantee that corrections are not going to be allowed to progress. As long
as the market is confident the Fed is back stopping the market this should have
the effect of creating extreme complacency over the next couple of
months.
From Gary Savage, Smart Money Tracker
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