Today's Barron's Online column was about the growing risk in the stock market even as the trend continues to march, or should I say, scratch higher. Volume is still pathetic and certainly we cannot say demand is forcing prices up. More likely there are simply no bears around to provide supply.
But how can I say risk is growing? Do I even look at the VIX? Of course I do and it is probing the lower levels of the trading range it was in BEFORE the financial crisis.
What me worry? Sorry, Al, you'd better.
Up 70% in nine months is quite overbought. And yes sentiment is quite frothy with Investors Intelligence at records for bullishness.
How about the latest roundup of Wall Street strategist views? The concensus is for 2010 to put in nearly a 10% gain from current levels! The lowest projection was essentially a break even so here, too, there are no bears.
The risk is that stocks are in a bubble and we know how bubbles end.
Again, have I stopped taking my meds? A bubble? What else would you call it when stocks rise 70% in nine months?