Finally, the perma-bears are turning bullish. They were wrong for so long so why would they be correct this time ? Maybe it's time to sell ...
SocGen’s Edwards: ‘Once-in-a-Lifetime’ Opportunity to Buy European Stocks By John Morgan
Albert Edwards, known as an unrelenting market bear, has reversed course and is now bullish on European stocks — but mostly for investors with binoculars aimed at the far horizon.
Edwards, the chief global strategist for Societe Generale who the Financial Times described as “the most dogged ‘bear’ in the City of London,” created waves with his remarks at the bank’s annual strategy conference.
Edwards said European stocks are “unambiguously cheap” and recommended them for investors who would hold them for 10 years, the Times reported.
In fact, he went so far as to say the current environment represents a “once in a lifetime opportunity” to buy European equities.
However, Edwards also predicted eventual global stock gains to be tempered by considerable short-term pain.
He forecast that European stocks are at risk of a steep fall within the next 12 to 18 months, the Times said. He expects certain world stock markets will need to suffer more than two recessions before a true bull market can begin.
“We haven’t reached a culmination of despair,” Edwards said.
“In the sense that we are so far through the equity bear market, I’m relatively more bullish. I expect the S&P to go below 666. I expect there to be total carnage. But I’m more bullish than I was.”
The Standard & Poor’s 500 was trading around 1,470 Wednesday.
Edwards also said high-yield bonds are overpriced, and could become “the first area to blow up in people’s faces,” the Times said.
The Times reported that the capitulation of a so-called “perma-bear,” as Edwards has been described, would be a major event among highly watched professional investors.
According to MoneyWeek, Edwards also said this week a Chinese credit bubble is “as obvious a catastrophe as the U.S. in 2007.”
He expressed deep concern at capital outflows from China, and said it represents both capital flight (i.e. Chinese nationals transferring their money abroad) and a wider investor belief that China “just isn’t competitive anymore,” MoneyWeek reported.
In addition, he also forecast an emerging-markets balance-of-payments crisis, the magazine said.
Source: Moneynews
http://www.moneynews.com/InvestingAnaly ... /id/471697
It's all about "how much you made when you were right" & "how little you lost when you were wrong"