Many have been calling for the market's head over the past couple of weeks (did I say weeks, I meant months ... or is that years?) and it's not that difficult to get caught up in all the bearish sentiment we are inundated with each and every day. It's there when we wake up to the alarm clock radio; it's there when we log onto Bloomberg's before the trading day begins; it's there in our trading chat rooms; in the newspaper; the evening news; our emails; the blogs we read ..... it's everywhere!
What has become apparent is that investors are not the only people caught up in "herd mentality." Those of us writing about the markets on a day-to-day basis are also guilty of it, and we are the ones who should be digging deeper and looking for reasons why the herd might be wrong.
That said, it's so much easier being part of a group of people who have essentially come to the same conclusion, than it is to say, "Wait a minute! Maybe we're missing something!"
Of course, if everyone else is dancing to the same drummer, then we are only guilty by association.
"So ... take me to court! The caveat was right there in the fine print (didn't you read it?), which simply states, 'I might be wrong.'"
"And besides, there's a good chance much of the analysis I presented to you was generated elsewhere (by some other unoriginal writers/analysts aside from me who couldn't think for themselves, either), and even if what I said came across to you as my very own ideas ..... I am ONLY one small member of the herd."
And the crowd becomes the parachute.
Saved by consensus (and a caveat, which, by the way, you can read at the end of this commentary).
Here's a chart, take it for whatever you think it's worth, and factor in the time constraints while you're at it.
We've been doubting Mr. Market for four years now, and he's continually proven us wrong.
When we start to think he's right ...........
That's when he'll be wrong.
