Goldman’s Cohen still upbeat on stocks
March 23, 2001 — Abby Joseph Cohen of Goldman Sachs, in an interview on CNBC March 23, offerered a positive outlook on the stock market.
Cohen added her voice to the proceedings in a speech in Kansas City on Wednesday, telling her audience that the wisest course for investors now is to think like a contrarian and “look for opportunities … when everyone’s nervous.”
This Orwellian rewriting of her own previous statements about the market should not go unnoticed. It was, of course, Cohen who had, on almost numberless occasions in the past, pronounced the late 1990s stock market bubble to be a real “bull market” in equities. She more than anyone else on Wall Street stood out as the poster babe for the New Paradigm, repeatedly declaring that technology investment was driving the birth of a “new economy” and that (as she put it in a speech in Milwaukee in January of 1999), “the Internets are real…”
Since then, of course, the tech bubble has popped, and absolutely every penny of portfolio gains racked up by such cheerleading has been wiped out, as the Nasdaq has collapsed back to its levels of late 1998, emptying the pockets of any investor who had followed the advice of Cohen and her chorus.
Yet no one likes to make a public admission of having following the wrong course when the wake stretches so far back into the past. So, scarcely had the market showed signs of recovery than Cohen was standing up in Kansas City to declare that stocks are cheap and that technology stocks are particularly attractive.
It was the same message she delivered, at just about the same time, to a reporter from the Singapore Business Times, who quoted her as saying that “stocks have fallen to levels which suggest that the two days of rallies last week were signaling the reversal of a bear trend, particularly for the technology sector.”
Yet even as Cohen spoke, stocks were getting “cheaper” and “more attractive” by the minute, as the three-day rally that had uncorked the optimism, fizzled, sending the Dow skidding Wednesday to a 162-point loss while whacking another 6 percent off the Nasdaq. |
