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Strategies & Market Trends : Booms, Busts, and Recoveries
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From: energyplay11/25/2004 12:05:56 AM
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"The Bear case always sounds more intelligent than the Bull case "

From TheStreet.com -

by David Merkel

Apocalypses ain't what they used to be (or what they will be)
11/24/04 3:45 PM ET
Aaron/James, when I consider Steve Roach, James Grant, Bill Gross, and other extra-bearish pundits, I recognize three things:

1) They are smarter than me.
2) They are not much use in timing investment decisions.
3) It is easy for them to get caught in a psychological rut far away from the consensus, and further away from what is likely to happen in the short run.

I admire them all, and use them to help me structure my macroeconomic backdrop for investing. But as Cramer has pointed out repeatedly, the bear case is always more intelligent sounding than the bull case.

I write this as a modest bear at present. I can't justify the current rally, but also can't see a panic at present. Panics happen when cash flow can no longer support leveraged assets, and that hasn't happened yet. There were hints of that in early 2000, when weaker market players showed a lot of financial strain prior to the turn down in March of 2000.

For the present, if we begin to see a larger upturn in consumer bankruptcies, that would signal a larger problem in the short run. I just don't see that now
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