I think the percentage of people who believe this rally is the beginning of a new bull is very very low. This makes it even more interesting. If you compare 2003 and this rally the similarities are striking. 2003 I heard the same arguments and people only discussed points to reopen short positions, no one was talking about opening new long positions and still the market kept rising.
I don't 'feel' 2003 here. March 2003 I remember some very good people were calling a buy in stocks, I hear a few now but not with the same conviction. The Iraq war was going better than expected, we were not in a recession, the 2001 recession was pretty tame, people were still feeling a little exhuberant after the 90's, and corporate accounting scandals were nothing like the the scale of the present bank failures. I went all-in and felt very comfortable. I would not be comfortable going long now but that's just a feeling. At least wait for a pullback.
The 2003 bottom also seemed to spend more time there, it wasn't a V, more like a multi-month painful and frustrating double or triple bottom. Should that matter? I'm not sure.
The 82 bull started after an extremely long period of malaise and a dramatic shift in monetary policy, the post depression period was built upon the fact that global competitors were leveled. 95-2000 was a tech bubble, 2003-2007 was a housing and credit bubble. So we need another bubble in something, a war, or some type of big positive change in the financial system.... The wild card are foreign economies, maybe this time they could take over leading and consuming then all this won't matter as much.
I am worried but maybe that's the wall this market is clinging to. It seems at some point though there needs to be real growth to sustain it, I doubt government printing presses will be a substitute for real organic growth.
