Has the Economy Turned the Corner or Just Turned Over?

It is fascinating to watch how emotions shift each week. Some view that the economy as turning some sort of corner. Keep in mind how equity markets behaved in the summer of 2000, the fall of 2007, the spring of 2008 and the fall of 2008 too — all huge head fakes.

The S&P 500 stood at 1,109 last Friday, 9/10/10.

The S&P 500 was also at 1,109 back on 4/1/88, over 12 years ago.
That is 12 years of nothing and the majority of talking heads believed/believe we were/are in a new bull market.

The S&P 500 was also at 1,109 back on 11/16/09, 10 months ago.
That is 10 months of nothing and the the majority of talking heads believed/believe we were/are in a new bull market.

Over this 10-month period, the S&P 500 has see-sawed above and below the 1,100 mark 15 times. Can you say roller coaster!

At what level would I be more bullish? Approximately 20% below 1,109 is a level I would consider to offer compelling value.

INVESTING WISDOM

“It is impossible to produce a superior return unless you do something different from the majority.”

Source: Legendary value investor, Sir John Templeton