Merrill Finds That Money Manager Confidence In Stocks At All Time Record High

Tyler Durden's picture

And the latest confirmation that nothing will ever go wrong again, since if it does it will mean everyone will be TBTF, being on the same side of the sinking ship, comes courtesy of the formerly insolvent bank known as Merrill (and now as taxpayer bailed out Bank of Countrywide Lynch), whose survey of money managers has just found that more are bullish on global stocks than at any time in the history of the survey. As in "ever." "A net 67 percent of respondents, who together manage $569 billion, had an “overweight” position on global equities, the highest level since the survey first asked the question in April 2001. That compares with 55 percent in January and 40 percent in December. Meanwhile, a net 9 percent is “underweight” cash, the lowest allocation since January 2002." Translation: everyone is long stocks. Every "balls to the wall" one. The Bernanke Put has succeeded in eliminating every last drop of risk from the stock market.

From Bloomberg:

The February survey “is one of the most bullish in years,” Gary Baker and Michael Hartnett, equity strategists at BofA Merrill Lynch, wrote in a report today. “Surging inflation expectations show we are no longer in a Goldilocks environment and a meaningful tactical correction in risk assets could be caused by a jump in interest rates or weaker U.S. growth.”

A net 34 percent of survey respondents are now “overweight” U.S. equities, up from 27 percent in January.
Appetite for euro-area stocks has also risen, to net 11 percent “overweight” from 9 percent “underweight” in January.

Meanwhile, February saw the biggest decline in emerging-market exposure in the survey’s history, with net 5 percent of managers now “overweight” global emerging-markets equities, down from January’s 43 percent.

“Unusually, higher risk appetite has been accompanied by a dramatic downsizing in asset allocation to emerging markets, as surging global growth expectations have increased the value attractions of developed-market alternatives,” London-based Baker, head of European equities strategy at BofA Merrill Lynch, said in a statement.

The survey was conducted between Feb. 4 and Feb. 10.

Simply said, there hasn't been a greater allocation of people on the same side of a sinking cruise ship since the Titanic. Too bad Chairsatan Generalissimo Vissarionvich von Bernankestein wasn't alive back then to prevent that particaular disaster.

Full "Merrill" report: