Looks like Iso not the only one who went to CASH last week:
<Time to get out of this market?
Monday August 9, 12:01 am ET
By Peter Brimelow
NEW YORK (CBS.MW) -- The good news: Richard Russell greeted Friday's Dow disaster calmly. The bad news: He changed his mind.
On Friday night, the octogenarian editor of Dow Theory Letters didn't gloat at the apparent confirmation of his long term bearishness -- just as he surprised many by refusing to hit the panic button when the Dow Jones Industrial Average (^DJI - News) fell below 10,000 in May. (See my May 31 column).
Russell even said he was taking the weekend off. But it seems that the more Russell thought about things, the less he liked them.
On Saturday morning, he posted to subscribers anyway ("I lied"). He wrote:
"My advice is to be OUT, OUT, OUT of this market and to be in cash. Leave your gold positions alone.
"The way this market is going, I expect it to at least 'test' the September 2002 low of around Dow 7,500 and maybe lower.
"For those with the guts to play the game, short the Spyders (AMEX:SPY - News) or the Diamonds (AMEX:DIA - News) or QQQ (AMEX:QQQ - News)."
The Hulbert Financial Digest's analysts would rate this as bearish.
For good measure, Russell added:
"PS -- It wouldn't surprise me if they 'pull' the Google offering. These guys waited too long. They may know all about the Internet, but they don't know markets!"
You have to be interested, because Russell has an unparalleled record at calling junctures, beginning with the last bear market low in 1974.
The other "geezers" -- letter editors who were around in 1974 -- were getting presciently jumpy when I last looked. (See related column.)
But some of them were bullish. One with an excellent record, Dan Sullivan of the Chartist letter, was still somewhat bullish on Friday night. Still, he reduced his exposure on July 29 -- and he sounds strained:
"Right now we remain cautious and are in an approximate 54% invested position. In the Traders Portfolio, Coach (NYSE:COH - News) and Yahoo (NasdaqNM:YHOO - News) violated their mental stops today and should be sold."
Another generally bullish letter I've counted as a "geezer" is the Cabot Market Letter. (May have to review this, now that Carlton Lutts has handed over to his son, Timothy, and retired).
Cabot still says: "We're optimistic that the year will end on a positive note, as election years often do; and we're optimistic... that 2005 and 2006 will be highly profitable years."
But its short- and medium-term indicators have gone negative and it said recently:
"The trend is down... Now that doesn't' mean you should sell all your stocks. But it does mean you should be vigilant about selling off your weakest stocks and pruning your losers. In the Model Portfolio we're now down to seven stocks, out of a maximum of twelve, and we have a cash position of about 40%. We're watching our remaining stocks like a hawk, and if any falter, they will be sold too..."
Recent Cabot sales: Psychiatric Solutions (NasdaqNM:PSYS - News); ValueClick (NasdaqNM:VCLK - News).
A word from the Hulbert Financial Digest: the average exposure to the general U.S. equity market was 1.52 percent -- a sharp drop from 12.46 Wednesday night.
(See my Aug. 5 column.)
A sharp drop -- but not sharp enough, in Mark Hulbert's contrary opinion. He points out that in May, when the Dow was last below 10,000, the average exposure was negative 19 percent.
In other words, the editors are not really scared.
Yet.
Best-performing timers still bullish
Market exposure among market timers
Profiles of All Star Fund Trader, F.X.C. Newsletter, No-Load Fund Analyst, Timer Digest>
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