Enough with the Johnny Come Latelys

 | Oct 27, 2011 | 4:02 PM EDT  | Comments
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Embarrassing.

I am talking about how, all day, I heard people be bullish who had been bearish.

Nope. Not right.

The time to be bullish was when everyone was saying it was the end of the world. The time to be bullish was when people felt that we were going to be run over a cliff from Europe. That doesn't mean you had to be bullish at the beginning of the month, although that would have been amazing. That was when you heard lots of talk about crashes and head-and-shoulder patterns and how it was all over for Europe.

You had a second chance when we had a breakdown in talks on Oct. 17. You could have bought the heck out of the market believing that the breakdown was just temporary.

And then there was two Mondays ago. We came in. There was no deal over the weekend. People got hugely short. Of course, we never looked back again.

I can forgive those who were bearish coming into the month. September was TERRIBLE. We were still dealing with the overhang of the government shutdown here and the downgrade of our bond rating. Over there it was pure chaos. At the beginning of the month we heard obituary after obituary for the euro and the FXE traded at 131.

It brought out a huge number of bears.

But a week later nothing had collapsed, the euro started to go up and yet surveys showed even more bears. That was a terrific moment to buy. Yet I heard over and over again that the Lehman moment awaited us.

The Oct. 17 breakpoint was easier to buy than the beginning of the month, but I just heard and saw lots of heel digging. That was despite the fact that we had good earnings reports. In fact, the only really bad report, Alcoa (AA), occurred first. It is safe to say that it was the worst and they have all been better.

But last week was a crucial moment. And don't I know it? In what may be one of the great reversals I have seen, my friend Bert Dohmen of the Wellington letter, who had been justifiably bearish for ages and dodged some really horrible downside, stood the charts on their head and went outright bullish.

What a call.

I mention Bert because he did what really takes guts. He switched. And he switched at the last train out of the station.

Now people are in left and right, many of them being the same people who told us to avoid this market at all costs. Don't I know it? We have been buying the cyclicals at Action Alerts Plus and paying the price. In 72 hours we have seen gains of a lifetime.

Now people want to come in?

I have to tell you, I understand why people want to buy but I haven't heard a word of recognition other than from our own Doug Kass that these all–in players hated it coming in to today.

What's the difference from Bert?

Simple, when it was really hideous, he went to buying. That's what takes guts? Come in now? It just takes admission of how wrong you were.

I wish I heard it.

I didn't.

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