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It Is Time For BofA's Economist Neil Dutta To Change His Permabullish Tune
Little by little, the macro economists at all the sellside shops have been turning bearish. Jan Hatzius, once again proves his worth, by seeing the writing on the wall sooner than most of his colleagues and turning negative about a month ago. Yet in a field in which the faux bullishness of a "strategist" directly correlates to the amount of capital at risk of complete wipeout should stocks begin approaching their true value, there are those who clutch to every straw of optimism harder than a drowning man on the verge of going over the Niagra Falls. One such specimen is Bank of America's Neil Dutta, who through thick and thin has kept "the 99% empty glass is 1% full" perspective for far too long. Which is why we would like to call Mr Dutta out: in a note to clients from two days ago, Neil said: "If our forecast for +125,000 in private payrolls comes to"fruition, we think the economy should be able to generate the kind of income growth necessary to offset the fiscal fade coming in the back half of this year." Well, Neil, your permabullish forecast has once again come well short of reality. It is time to admit you have been wrong, and no, saying next month's NFP will finally be better is just not going to cut it anymore: even Christina Romer got that memo. So please spare us the sugar coating and for once tell the truth as you see it, and not as your corporate overlords at 1 Bryant Park demand you spin it. For your own sake.
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Market is going to be coming back today. You can't stop the effect QE2.0 will have. Buy all asset classes, even equities.
Absolutely correct. That will be the initial reaction and may last a little while. However, there is no amount of QE that will eventually prevent multiples from falling back into the single digits. It is simply a question of timing.
All these trillion $ bailouts are chasing a $700 trillion derivatives market down a hole.
The end is clear, the question is when?
classic cnbc saying the news is actually good but the problem is that obama is not communicating all the good things he is doing. like a sat. night live skit, the labor sec. is happy with the horrible job #s - how can this fraud continue?
"Little by little, the macro economists at all the sellside shops have been turning bearish."
As a result of this info I am turning even more bullish. Thanks TD.
I couldn't agree more with realtick. When all the sell side guys turn bearish it's always a great time to buy. Not to mention allocations to equities are pretty damn low. Every bad Econ news lately has been shrugged off by the market. If the market pulls back here I would buy buy buy!!!!!
@ Ando - Thanks. Love ZH and TD, mainly now as a contrary indicator, especially when the are using economists to justify their bearishness.
This chart of mine is the road map I'm using: it will work until it doesn't.
http://i38.tinypic.com/13z0qv5.jpg
Andover?
Market only down 50 points now. I can't even imagine what would have happened if the payroll report was worse than expected.
We have always been at war with Eastasia.
A new phase of the global slowdown is upon us. Reports this week from all 4 corners of the globe are flashing red. Euro zone and GB showing slowdowns in industrial output is terrifying in the face of a precarious fiscal and monetary situation. US slowing strengthens the case for QE2. Japan is announcing further easing. Even Canadian and Australian numbers have surprised to the downside. And China keeps maintaining that more stimulus is needed as it blows a mega bubble. Meanwhile, this week showed the full evidence of inflation within our deflationary depression as all commodities surged, especially energy and ag. Currencies are once again volatile. And safe havens are cram packed as Treasuries reach new record low yields weekly.
Banks are as uncertain as the governments that back them. They only have one trick: print more and cover up more. We all know how this is going to end. Money is no longer safe in cash.
SP now only down 3.20
10yr now at 2.86
The new(old) argument to explain the divergence will soon be dug up on CNBS et al. "Bond yields are so low that "investors" are buying stocks, especially high-dividend stocks, in search of returns".
By the end of the day, someone will have said this and then it will be repeated often enough until it is the accepted, conventional wisdom.
+1. Even the 30 year is now at 4.00. Pretty soon people will be paying the government for the priviledge to hold their money, right up to the point that this all ends in tears.
How far will the PPT cause us to crash with this fucking bullshit?
So, do we go green before the 1430 EST ramp or earlier? My guess is earlier.
Wonder what the news will need to be to actually bring the DOW below 10K and S&P below 1140? Maybe such news doesn't exist.
Mission accomplished.
Market stabilized.
Hit the LIE before noon to beat the traffic.
Feet in the sand, margarita in hand by 2:00.
Sad but true, Mr. Turd
Hmmm. The Turd is always the first to admit his errors. Maybe spoke too soon.
SP down 14.87
Karthik Athreya ..Neil Dutta....both Indians !!!!!!...I m so proud of them
Wanna be 100/100 when reality is 60/100 or lower ?
No...there really is no tooth fairy....
........................................................
What would turn the economy around....?
Complete tax structure change 100% in favor of small business....
Eliminate the corporate and individual income tax....replace with a 15% consumption tax only....
Want proof?
....................................................
Model the current structure....size of the economy in 10 years....
Now model the size of the economy in 10 years if the individual and corporate income taxes were eliminated....
Trying to tell an economist he is wrong is like trying to tell the tree people not to eat monkey heads.
If I were in Neil Dutta's shoes, I'd be bullish as long as my corporate overlords were willing to make it worth my while. I betcha Neil is laughing all the way to the bank, or in this case from the bank.
Speaking of bullish turds, where is leo "monster job number" this morning?
No doubt double fisting the solars.
There are certainly a lot of details like that to take into consideration.I read and understand the entire article and I really enjoyed it to be honest.
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