Rearview Mirror Watching Leads to Bottom Blindness
An article on Seeking Alpha the other day caught my eye – entitled “10 Reasons Why We Still Haven’t Hit Bottom,” it oversimplified a number of points and unnecessarily dramatized others. Comments on the points, which I’ll number to match the author’s system.
By James Cullen at collegeanalysts.com -- 1.) It’s much easier to say that people are looking for a bottom two weeks after the market actually put in a low, and has risen by 20%, than to consider what happened at the point in time when the low occurred. So, what was sentiment actually like? First, this chart from Bespoke shows their poll at the November 2008 “Citigroup (C) Bottom” – note that 90% of voters are expecting lower lows, and the modal response looks for a 20% loss.