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Jim Cook

 

RUNAWAY SOCIAL SYMPATHY

Every once in a while I switch the TV channel from Fox to CNBC to see what the liberals are saying.  After listening awhile I get a deep sense of hopelessness and foreboding for our country.  The most important thing for the left is giving money to people.  They are happy to see the growth of food stamps, disability payments, housing subsidies, free healthcare and all the other welfare benefits.  They utterly fail to see the damage it is doing to the recipients.  Whole cities that once flourished have deteriorated into rotting eyesores populated with shambling hulks of chemically dependent drones.  These people are no longer employable.  They have become incompetent and helpless and the liberals can’t see that it’s their doing.

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The Best of Jim Cook Archive

 
Commentary Of The Month
January 30, 2014
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IS IT THE TOP?

By Graham Summers

Over the last 12 months, institutional investors have been net sellers of stocks for most of the time. This trend became much more pronounced in July with institutions selling an average of $1 billion in stocks during that period. Institutional investors are dumping stocks at a pace last seen in the first half of 2008. We all know what came next. Among the financial institutions that are dumping stocks include Apollo Group, Blackstone Group, and Fortress Investment Group. These groups are not only selling themselves, but have been urging their high net worth clients to sell stocks as well.

In addition to this, those at the top of the corporate food chain are uneasy with the prospects for economic growth. Markit’s semi-annual Global Business Outlook Survey of 11,000 CEOs found Chief Executives to be the most negative since the depths of the Great Recession in early 2009. Thus, we see the “smart money” exiting the markets.  We also see fewer and fewer companies participating in the market rally. Those who run these companies are more pessimistic than at any point in the last five years dating back to the nadir of the 2009 collapse. And finally we have investors as a whole displaying the most complacency about the market in history.

Finally, there are major valuation concerns for the markets today. The market as a whole is trading at 25 times its average earnings of the last ten years. Stocks are showing all of the hallmark signs of topping out. The market is overpriced, overbought, the smart money is selling, CEOs are bearish, market breadth is shrinking and earnings growth looks poor.  When this correction finally comes… it could be BIG one.