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Top Wall Street Strategist: 'We're On The Verge Of The Next Great Bull Market'
TBI ^ | 8-7-2012 | Mamta Badkar

Posted on 08/07/2012 3:02:11 PM PDT by blam

Top Wall Street Strategist: 'We're On The Verge Of The Next Great Bull Market'

Mamta Badkar
Aug. 7, 2012, 5:19 PM

In an interview with Bloomberg TV however, BMO's Brian Belski says that despite the lack of investor confidence, stocks are set to do well.

He also said investors in the past decade have focused too much on macro as opposed to stock fundamentals:

"What we have here to quote Cool Hand Luke is "a failure to communicate". Investors clearly have confidence issues this year and that's why you've seen these sharp moves to the upside and the downside. We continue to think we're on the verge of the next great bull market.

...I'm not trying to price myself out of a job but in the last 10 - 12 years we in the investment world have become so macro dominated we've forgotten that really fundamentals define stocks. We live by one very simple premise that stocks lead earnings, which lead the economy. "

In a note to clients, Belski along with BMO strategists Nicholas Roccanova and Mira Borisova point out that "S&P500 earnings are not U.S. GDP". They write that earnings growth is more sensitive to emerging market growth anyway so it could weather a slowdown in the U.S.. They also say historical precedence shows that stock market performance has been strong even when earnings growth has deteriorated.

In fact, continuing on his vein of stock leading earnings, which lead the economy, Belski says:

"We think the stock market revival we've seen in the last several weeks is foreshadowing what's going to happen in the economy again …meaning a recovery in the second half."

Bottom line: While higher earnings growth have led to higher stock prices, it doesn't mean that weakening earnings growth

(snip)

(Excerpt) Read more at businessinsider.com ...


TOPICS: News/Current Events
KEYWORDS: bulls; economy; investing; markets
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1 posted on 08/07/2012 3:02:23 PM PDT by blam
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To: blam

Sounds like a lot of bull to me.


2 posted on 08/07/2012 3:04:08 PM PDT by LegendHasIt
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To: blam

I’ve seen emails from Nigeria that sounded more convincing than this guy.


3 posted on 08/07/2012 3:05:01 PM PDT by ClearCase_guy (Roger Taney? Not a bad Chief Justice. John Roberts? A really awful Chief Justice.)
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Comment #4 Removed by Moderator

To: blam
Whoa Nellie!!!

Eat, drink and be merry, for tomorrow we die!!! (or almost wish we did)

5 posted on 08/07/2012 3:06:33 PM PDT by SierraWasp (Government it'self is the REAL "Free Rider!" Obamacare will create burdensome "Free Riding!!!")
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To: blam

Gosh I WONDER if AFTER the election we’ll see these rosy stories, right...?

NOT. HOLDING. BREATH.


6 posted on 08/07/2012 3:06:56 PM PDT by gaijin
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To: blam
Color me unconvinced.

/johnny

7 posted on 08/07/2012 3:07:14 PM PDT by JRandomFreeper (Gone Galt)
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To: blam

Obama operative: I’m telling you folks, the very day after the election things are set to boom.

Now that I can believe...

The market taking off? Not so much.

Frankly I’m amazed it’s where it is. It defies logic to me, but what do I know. My money sure isn’t in it.


8 posted on 08/07/2012 3:07:14 PM PDT by DoughtyOne (Nope 2012)
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To: All


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9 posted on 08/07/2012 3:07:42 PM PDT by musicman (Until I see the REAL Long Form Vault BC, he's just "PRES__ENT" Obama = Without "ID")
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To: blam

Hey folks, go back four years. Weren’t they saying business was really going to rally under Obama?

How did that work out? Why should we believe them now?

“Oh pleeeeese, just one more chance, just one, I’ll be good...”

Guy is nine years old I’m tellin ya.


10 posted on 08/07/2012 3:09:07 PM PDT by DoughtyOne (Nope 2012)
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To: blam

I don’t know what to do, anymore. Stocks were poised to crash. I was thinking about shifting lots to precious metals, and shifted some. But I mostly held back. Then gold and silver declined, a lot. Good thing I didn’t cash out of stocks, and good thing I didn’t buy more metal on it’s way down. Now my stock holdings are up, crazy market. What to do?


11 posted on 08/07/2012 3:10:31 PM PDT by roadcat
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To: blam
Mamta Badkar is a reporter at Business Insider. She has a Master's degree in journalism from Columbia University.

Need I say more?

12 posted on 08/07/2012 3:10:40 PM PDT by bmwcyle (Corollary - Electing the same person over and over and expecting a different outcome is insanity)
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To: blam

Kool Aid drinker.


13 posted on 08/07/2012 3:11:49 PM PDT by boomop1 (term limits will only save this country.)
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To: blam

He sounds like one of those experts that is “surprised” by the “unexpected” news on an almost weekly basis.


14 posted on 08/07/2012 3:12:32 PM PDT by gorush (History repeats itself because human nature is static)
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To: blam
Good news is the markets set to shoot up.

Bad news is so are Barry's capital gains taxes.

Thanks for nothin'

15 posted on 08/07/2012 3:12:59 PM PDT by skeeter
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To: blam

Maybe when Obama loses 90 days from now.


16 posted on 08/07/2012 3:14:30 PM PDT by Red Steel
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To: blam

If Obama is elected it will a Burro market... currently its a Donkey market..

If Romney is elected it will be a RINO disguised as an Elephant market..

Obama has butchered the BULL... for steaks and hamburger for his friends..


17 posted on 08/07/2012 3:16:43 PM PDT by hosepipe (This propaganda has been edited to include some fully orbed hyperbole..)
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Comment #18 Removed by Moderator

To: blam

The writer may be correct. But to me it sounds like the precursor to another “Pump and Dump”.


19 posted on 08/07/2012 3:19:52 PM PDT by The Working Man
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To: blam
You've got to hand it to the "sovereign debt is a meaningless abstraction" crowd: they have finally come to believe their own masturbatory monetary fantasies - Helicopter Ben will make everything right again, right around October. Just print ad infinitum, and whothefuck cares any more? "Value" is just a meaningless abstraction and besides: you didn't build that, anyway. Pimp my portfolio, bitchez... Obama will tax the shizzle out of the 1% to pay for it.
20 posted on 08/07/2012 3:20:06 PM PDT by andy58-in-nh (America does not need to be organized: it needs to be liberated.)
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To: blam
'We're On The Verge Of The Next Great Bull Market'

Should be showing up on or about the 1st of October.

21 posted on 08/07/2012 3:20:28 PM PDT by EGPWS (Trust in God, question everyone else)
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To: blam

Romney is destined to win?


22 posted on 08/07/2012 3:20:38 PM PDT by Paladin2
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To: blam

If Obama wins in November, the market will crash and we will be in a full-fledged depression. No one should buy stock until after the election.


23 posted on 08/07/2012 3:21:55 PM PDT by txrefugee
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To: blam

I imagine that going short or long in the market now is basically akin to betting whether 0 is reelected or not.


24 posted on 08/07/2012 3:25:04 PM PDT by the anti-liberal
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To: DoughtyOne
Sliding Toward A Recession

Investors, however, seem to be following a different line of thinking. They are responding to two entirely different hypotheses.

1. The economy is doing well. That was the news in the latest unemployment report. Therefore it makes sense to own stocks and gold. As the economy improves, more people will borrow and spend. As they do so, interest rates and consumer prices will rise. Businesses will do better as their sales rise. Higher inflation rates will cause gold to go up, too.

2. The economy is not doing well. And the worse it does the more pressure builds on central bankers to ‘do something.’ What can they do? Only add more cash and credit. More liquidity will send both stocks and gold up.

Now, you will look at these two hypotheses and think you have discovered a sure thing, no? A can’t-lose proposition, right? Either the economy is doing well. Or not. Either way, stocks are going up! Win…win…right?

Wrong!

25 posted on 08/07/2012 3:26:59 PM PDT by blam
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To: blam
An interesting bit of trivia:

The German stock market was at 97 in January 1919, 166 in January 1920, 278 in January 1921 and 731 in December 1921.

The German stock market was at 743 in January 1922 and rose to 8,981 in December 1922. The German stock market was at 21,400 in January 1923 and rose to 26,890,000 in November at the peak in 1923.

In nominal terms it sounds like one monsterous bull market, but in real terms as the value of the reichmark circled the drain to worthlessness, it meant nothing.

26 posted on 08/07/2012 3:30:24 PM PDT by OB1kNOb (The prudent see danger and take refuge, but the simple keep going and pay the penalty. - Prov 22:3)
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To: blam
...They also say historical precedence shows that stock market performance has been strong even when earnings growth has deteriorated.

In fact, continuing on his vein of stock leading earnings, which lead the economy, Belski says:

"We think the stock market revival we've seen in the last several weeks is foreshadowing what's going to happen in the economy again …meaning a recovery in the second half."


Does anyone else think this sounds like 0bama's twisted economic theory of recovery flowing from the bottom up?

I'm no financial expert but doesn't lasting gains in stock prices need to be built on earnings? Didn't we learn anything from the Dot Bomb crash of the 90s?

27 posted on 08/07/2012 3:34:39 PM PDT by YankeeReb
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To: blam

Take that headline advice and run the OTHER WAY fast.


28 posted on 08/07/2012 3:35:04 PM PDT by BreezyDog (PLAN A: A Peaceful Restoration of the Republic.....PLAN B: A Restoration of the Republic)
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To: DoughtyOne

I’ll say this about Obama -

He has behaved EXACTLY as anybody with a decent understanding of his past history would predict.

No honest person can say he’s been a surprise.


29 posted on 08/07/2012 3:35:18 PM PDT by nascarnation
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To: blam

How the hell did Baghdad Bob end up working on Wall Street?


30 posted on 08/07/2012 3:38:33 PM PDT by jwalsh07 (.)
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To: OB1kNOb
In nominal terms it sounds like one monsterous bull market, but in real terms as the value of the reichmark circled the drain to worthlessness, it meant nothing.

That indeed looks like what is happening to us. Wealth can't be preserved, only spent as things spiral out of control. Stocks up, but spending power erroded in a vicious spiral. Sad times coming.

31 posted on 08/07/2012 3:44:37 PM PDT by roadcat
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To: blam


32 posted on 08/07/2012 3:46:18 PM PDT by Iron Munro ("Jiggle the Handle for Barry!")
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To: blam

Based on history, I believe we’ll see almost another decade of this bear market before it is over. We will have great opportunities and some devastating losses during this timeframe. Plan accordingly. Gold will rise to +$3,500 per oz. I’m expecting closer to $5,000 per oz.


33 posted on 08/07/2012 3:48:14 PM PDT by aMorePerfectUnion ("I'm comfortable with a Romney win." - Pres. Jimmy Carter)
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To: blam
IF the author is correct, and I believe he may be, this is all in spite of Obama and not because of Obama. Similar to the success of the oil industry in North Dakota.
34 posted on 08/07/2012 3:50:46 PM PDT by jdsteel (Give me freedom, not more government.)
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To: blam
lets see, nobody can afford to buy the stuff the companies make, but their stocks will go up...

what am i missing here???

35 posted on 08/07/2012 3:56:19 PM PDT by Chode (American Hedonist - *DTOM* -ww- NO Pity for the LAZY)
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To: blam

Yeah, “bull” is right, that’s why I bought more gold and anmmo thiis week!


36 posted on 08/07/2012 4:00:28 PM PDT by ThePatriotsFlag (The hotter the TEA, the stronger......and I'm boiling!)
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To: jdsteel

IMHO - Until Federal spending is reined in and the deficit starts to shrink, further increases in the DOW will mostly be due to the plunging value of the dollar.

The Dow may very well end up at 26,000.

But at the same time a pound of sirloin steak will be $10-$15, a gallon of gasoline will be $20-$25, and a can of Pork & Beans will be $3.00.

If there is another Bernanke Quantitative Easing or another Obama Stimulus it will be worse than that.


37 posted on 08/07/2012 4:00:28 PM PDT by Iron Munro ("Jiggle the Handle for Barry!")
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To: Chode

The value of the dollar is going down, which makes stocks correspondingly more expensive.


38 posted on 08/07/2012 4:02:08 PM PDT by the anti-liberal
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To: Chode
"lets see, nobody can afford to buy the stuff the companies make, but their stocks will go up...
what am i missing here??? "

Too Big To Fail?

Seems like everyone reckons that just before it all crashes, Bernanke and Co. (and which ever puppet of Goldmann Sachs is running the Executive Branch) will just bail them out again, at the expense of taxpayers (and everyone with savings, Through hyper inflation).... But at least the Wall Street crowd will be able to line their pockets with other peoples money.

39 posted on 08/07/2012 4:06:22 PM PDT by LegendHasIt
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To: Iron Munro

GMTA.
I wasn’t copying, honest.


40 posted on 08/07/2012 4:08:04 PM PDT by LegendHasIt
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To: blam

There are too many dollars chasing too few stocks. It is structurally bidding up stock prices way beyond their fundamentals — witness the crazy PE values.

The smart money is in private equity and hedge funds (if you have a million dollars to buy in), taking publicly held companies out of the stock market and going private.

NYSE and NASDAQ have small investors chasing too few public stocks, coupled with wild govt deficit spending driving up equities even more as people dump their dollars.

Thanks to SarbOx the public equity markets are being chased out. We’re going back to the 19th century model of capitalism, where a small number of billionaire magnates own private equity funds that own everything.


41 posted on 08/07/2012 4:08:34 PM PDT by Gideon7
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To: jdsteel
this is all in spite of Obama and not because of Obama

This is because of Romney.

As his numbers improve, investors and markets gain confidence.

42 posted on 08/07/2012 4:13:16 PM PDT by what's up
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To: jdsteel
this is all in spite of Obama and not because of Obama

This is because of Romney.

As his numbers improve, investors and markets gain confidence.

43 posted on 08/07/2012 4:13:29 PM PDT by what's up
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To: blam

Yep, as the bulls charge over the edge of the bottomless pit.

Let’m rip!


44 posted on 08/07/2012 4:17:53 PM PDT by editor-surveyor (Freepers: Not as smart as I'd hoped they were.)
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To: the anti-liberal
i understand inflation, but i always thought a Bull market meant people bought more stock not simply an inflated stock price and i can't see why people will buy stock in a company that isn't selling product...
45 posted on 08/07/2012 4:24:32 PM PDT by Chode (American Hedonist - *DTOM* -ww- NO Pity for the LAZY)
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To: OB1kNOb
Thanks for the historical data.

It provides plenty of opportunity for developing insight for our potential future.

46 posted on 08/07/2012 4:25:07 PM PDT by Paladin2
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To: Chode
Some folks don't actually look at the company they're investing in. They listen to their friend's tip they got from who knows where.

Or they believe stories like this one.

Who knows why some people do what they do...

47 posted on 08/07/2012 4:28:42 PM PDT by the anti-liberal
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To: blam

I’m having trouble predicting now, too many mixed signals.

But I bet few of the commenters here were bullish in March of 2009 either.


48 posted on 08/07/2012 4:31:23 PM PDT by SaxxonWoods (....The days are long, but the years are short.....)
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To: the anti-liberal
ain't THAT the truth...
49 posted on 08/07/2012 4:37:06 PM PDT by Chode (American Hedonist - *DTOM* -ww- NO Pity for the LAZY)
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To: blam
Whatever he's smoking, I want some.

Why not? Can't dance and voting is going to suck more than a Hoover with a Hemi.

50 posted on 08/07/2012 4:41:54 PM PDT by houeto (https://secure.freerepublic.com/donate/)
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