Hush my beautiful Black Swans. VIX approaches single digits. so just relax. Margin debt continues to reach all time highs. PE expansion continues obscenely. EPS no worries if it seems to be struggling. Guidance seems more difficult but what do professional managers with their hands on the steering wheel really know. The economy has shown signs of contracting but we somehow added jobs after a long cold hard winter.
Black Swans are supposedly random unforeseen. But how many truly believe interest rates will stay down. Governments have been spending like drunken sailors. Entitlements entrenched. Infrastructure left lacking. Black Swans increasingly look like interest rates rising because that’s one tough mountain that still has to be climbed.
George Gutowski writes from a caveat emptor perspective.