Mike Steinhardt: "No One Is Long-Term Bullish"

Tyler Durden's picture

Hedge fund icon Mike Steinhardt voices on what the smartest money on Wall Street is thinking and it is nothing good - fast forward to 3 minutes 25 seconds. Steinhardt is completely correct in saying "You can not talk about valuations readily" in this market.

In a nutshell - "Everyone is focusing on the next tick" and the follow up question: "What's going to drive growth" eventually?


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texpat's picture

Crap. Getting out of this market will be worse than getting out of a burning Chinese nightclub.

Anonymous's picture

It is said of drivers in Rome, that a red light is merely a suggestion. Stop loss orders will prove just as effective.

Anonymous's picture

Things I wish I said

Alexander Supertramp's picture

“As I have often argued:  Even the Almighty cannot determine a single correct value for the market as a whole.”  

– Burton Malkiel; “How much Higher Can the Market Go?”; The Wall Street Journal; 9/22/99

Anonymous's picture

"A mythical island where everyone earns a living taking in each others laundry." Robert Louis Stevenson

Anonymous's picture

Fair value is 6500 where the mafia boss came out with his famous reversal of his rampant catastrophe pessimism and said p/e's are a good value here.

Anonymous's picture

No one is Long term bullish... Maybe that's why SPX is going to break above 1570? :)

Anonymous's picture

me likes!

Anonymous's picture

Now that's what I call a 'V' !!!

ivant's picture

Some say square-root here :P I wonder what that likes. We shoot to 17 billion on DOW and then stop. Markets all freeze and stay there for a few years. Of course there could be a secret meaning: square root of the current price. Ouch.

Jacks Complete Lack of Surprise's picture

Sup, Tyler.

So what you are saying is Mike hit the mark on mark to market?

I think it's cute you realized I wasn't pulling your leg about the legality of front running, I mean shit man, they were even charging fees on their public books. You could get a fucking rate card to see just how much you wanted to front run like it was dim sum capitalism.

Now that has run its course, it's time to blow the lid of GSEs.

I hope you are clever enough to know what I mean, if not I'll drop another dime later this week.

After I have cashed in on it, of course. Till then keep pulling levers and pushing buttons.


Anonymous's picture

Are you the masked magician? How does the "pull my finger" trick work?

Assetman's picture

I think I just sharted! :)

Jacks Complete Lack of Surprise's picture

More the lone ranger on the cyber frontier, but whatever fantasy lets you sleep at night, go with that.

And the pull the finger trick works because most people are gullible as hell and easy marks, such as yourself.

Anonymous's picture

Personal attacks can get you banned.

Anonymous's picture

That is how bottoms form - when the stars of the last cycle(s) can't imagine how the stock market can rise.

cougar_w's picture

"can't imagine how" is a phrase that here means they haven't decide how and when to blow the next bubble, how to steer the market profits into the most deserving hands, and which industry regulations need to be "adjusted" to permit all this.

They should just jump the broom and form a cartel, figure out their bubble-ology by committee, and issue market targets for the next 5 years like it was Soviet era central planning.

We need to know what to mindlessly pursue! Show us da route to da money! Come on guys, work that mojo!



simonsays's picture

Which producer let this segment air? Off with their heads!

D.O.D.'s picture

WOW, was that an actuall conversation on CNBC?

Anonymous's picture

i noticed the same thing.....i kept expecting
some loud mouthed cnbc buffoon to yell
"You're WRONG!!!
Reuters just reported today markets were poised
to surge 300% by the end of the year!!" like
they were at a women's mud wrestling match...

ivant's picture

LMAO!! HAhahahahahahahahaha. E.G. have you guys noticed when Hendry speaks of everything getting killed some dude constantly says you are wrong.

Comrade de Chaos's picture



Corp's (ses) are hoarding money. SO much for that inventory stocking and recovery BS.

Anonymous's picture

Great link. Thank you JohnKing.

stedanrac's picture

 If we fast forwarded to 3:25, we'd miss Becky's pride and drawing a square root symbol....

Tyler Durden's picture

For the old-timers out there, does anyone have a recollection of the robert rubin desk layout (personnel wise) from the mid/late 70s?

Milton's picture

Charlie Haas started as a stockbroker at Goldman, but he's not that old to have been with Rubin.

Now he's running the "Haas of Pain" which isn't too far off from the House of Goldman.




nogeithner's picture
nogeithner (not verified) Milton Aug 10, 2009 10:01 PM

Valuations at nosebleed levels and the only ones buying are computers that sell less than a second later. Buy and hold takes on a whole new meaning!

my newest bookmarked finance website..http://www...

. . .'s picture

Why don't you use a layout like Michael Price?  He had everyone in one room, with a large T-shaped rading desk.  Price at the head of the T, and his traders along the sides.  All analysts sat at individual desks facing Price.

Why imitate Rubin in any way?

Anonymous's picture

pretty sure davidson of wexford as well as perry were some of the first mates. don't recall who the second fiddle lines was.

Anonymous's picture

Someone has done an nndb map of Goldman connections.


go to "nndb mapper", click "start a new map", click "browse map library", click the "business" category, scroll down to Goldman, then click "load", when the map appears you can expand each person and expand the "nodes".

But warning, this will bug you out.

michigan independant's picture

Rubin began his career as an attorney at the firm of Cleary, Gottlieb, Steen & Hamilton in New York City. He joined Goldman Sachs
Goldman Sachs

The Goldman Sachs Group, Inc., or simply Goldman Sachs , is a bank holding company that engages in investment banking, Security services, and investment management....

 in 1966 as an associate in the risk arbitrage
Risk arbitrage

Risk arbitrage, or merger arbitrage, is an investment or trading strategy often associated with hedge funds.Two principal types of mergers and acquisitions are possible:...

 department . Rubin proved his skills at the intricate art of investing his firm's capital in high-reward arbitrage

In economics and finance, arbitrage is the practice of taking advantage of a price differential between two or more markets: striking a combination of matching deals that capitalize upon the imbalance, the profit being the difference between the market prices....

 opportunities and became a general partner in 1971. He joined the management committee in 1980 along with fellow Democrat Jon Corzine
Jon Corzine

Jon Stevens Corzine is the Governor of New Jersey and a former United States Senator. He was sworn into office on January 17, 2006, for a four-year term ending in 2010, and has said that he intends to run for re-election in 2009....

, later a U.S. senator and governor of New Jersey
New Jersey

New Jersey is a state in the Mid-Atlantic States and Northeastern United States regions of the United States. It is bordered on the north by New York, on the east by the Hudson River and the Atlantic Ocean, on the southwest by Delaware, and on the west by Pennsylvania....

. Rubin was Vice Chairman and Co-Chief Operating Officer from 1987 to 1990. From the end of 1990 to 1992, Rubin served as Co-Chairman and Co-Senior Partner along with Stephen Friedman
Stephen Friedman (PFIAB)

Stephen Friedman is the current Chairman of the United States President's Foreign Intelligence Advisory Board. He was nominated on October 27, 2005 to replace Brent Scowcroft in the position....

Dixie Normous's picture

Steinhardt points to an interesting "phenomenon:"  He speaks to no real bulls he says, but ink they must not be angry enough bears either.  Therefore, the market will continue to float higher, IMHO.

I also got the impression that he thought a depression or near death experience would result in great changes in America and that hasn't happened.h

This conversation was too thought provoking, is there a CNBC sister station we don't know about?

Handle with care's picture

There have been great changes in America, we were all just looking in the wrong direction


When Obama was elected he was criticised for one of his team saying, "We shouldn't let a crisis go to waste", well that is exactly the philosophy that Wall Street has followed.


Their greed and insane risk taking created the greatest crisis in global capitalism since the Great Depression and their punishment has been to have managed to plug directly into the money printing facilities that are rightfully the perogative of the People alone.


They have held the economy hostage by claiming that if they get hurt they'll take everything down with them unless a ransom is paid.  That ransom has been paid.  The greatest ransom in history.  Trillions of dollars.


But the greatest change is that the same people who caused the crisis were loaned the taxpayers money at very low rates to buy the debt the government had to issue to pay them the money and they will receive their returns on this debt, paid for from the pockets of productive taxpayers, for generations to come.


The change is that now EVERYONE in America works to enrich Goldman Sachs and the tiny elite at the top and will do forever.


milkum bilkum pc's picture

We were all given a break because the panel tossed questions at each other... Beck's ear didn't tell her to say something "brilliant".

Milton's picture

Probability of S&P testing the 666 lows?

Gerstenhaber: "1 in 3"

Cooperman: "1 in 4"

Steinhardt: "more than that"


cougar_w's picture

Well. Given that they would be loath to guess too high a probablity for fear of breaking the markets (or being labled lunatics) the number actually in their heads must be closer to 1 in 2, or 2 in 3, then.

I get the feeling that TPTB are furiously trying to keep us on the level part of the square-root sign (once we hit it and we may have arrived already) to avoid a double-dip. As was mentioned in the clip, nobody is talking about this any more because of all the money pumped into the system, but that money hasn't gone anywhere that it will do any good. Thus I hear commentors saying that if there is a second dip then it's a LONG way down from here. The markets are dysfunctional and lacking any of the past resiliencies, program trading is much of the volume and tends to drive volatility, consumers are hiding deep in their shells, the government has run out of bullets and mobs are begining to form, Treasury auctions are teetering, and everyone is waiting to sell into the trough. Nobody wants to be the last one out, but they want to lose as little as possible on investments in the market from before 2007.

If that really is the mindset -- if everyone is just waiting to determine how best to exit the burning building -- then we are poised on the threashold of a very dangerous, very chaotic scene.


Milton's picture

My bad. Steinhardt actually said "less than that", in answering Quintanilla's comment of going back to 666.

Gilgamesh's picture

How's the SOX working as a leading indicator/index this month?

Dixie Normous's picture

Actually it's probably working great in today's fucked up world. 

It topped out last week and has been off now for a few days, right.  Now, when the TRANS or XBD or some other sector starts to roll over we can pump the SOX and hold that in while the others sell off, then rotate elsewhere, rinse and repeat.

It's a perfect market, 22 days running 140 + S&P points and no sell offs of more than 20 points from a high to a low.

Utopia Trading at its best.

Gilgamesh's picture

Ala Tour De France, with every index loaded on EPO.

Anonymous's picture

O h my it has come to this. Lowest volume day in maybe years the desperation trade of c fnm fre maybe half the total volume. This as the author suggests is going down. May i suggest selling all long positions and watching the next month?

mule65's picture

What is long-term?

Anonymous's picture

When he said "less than that", did he mean less than a 1/3 probability of going back to 666, or a 1/3 probability of going to less than 666?

cougar_w's picture

I heard that as "less than the last bottom at 666"

Anonymous's picture

As in he thinks the markets will go lower than
666? At least thats what I gathered from listening.

Anonymous's picture

Well "they" certainly want you to stay bullish that's for sure. Talk about a power hour on the SP500 futures...

cougar_w's picture

Really? They sounded quite alarmed to me. "Where will the growth come from?" was not a bullish sentiment. That was basically saying that the party is over UNLESS someone is going to propose another asset bubble. Really, the party was over around 1995 and there is no long-term plan for growth even from that far back.

Without a means to target GDP growth outside of financial voodoo, it's so over.