Hussman Funds - Markets Can Be Down 30% SOON

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January 14, 2013 - 10:21pm

By HussmanFunds“It's important to emphasize that standard bear market declines have historically produced losses averaging about 30% - generally not just 20% (15% declines don't even qualify). I don't expect the next one to be a significant exception… Suffice it to say that the only reason to buy stocks here is a) the belief that one can sell them to a greater fool at higher prices despite already overvalued, overbought, overbullish and rising yield conditions, or b) the belief that the stock market will soar 30-50% from these levels, without experiencing even a minimal bear market in the next 4-5 years.“Sometimes, it is sensible to speculate to some extent, even in overvalued conditions, if market action indicates an appetite of investors for risk and the market is not overbought or excessively bullish. Sometimes, strong multi-year gains without an intervening bear market are reasonable to expect, but those periods generally begin at much more favorable valuations. I realize that there is a visceral urge to participate here, as well as a fea


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