Went to a packed Panera (PNRA) on Friday. Just one of those by-the-roadside, exit-off-the-freeway Paneras in Connecticut somewhere. At lunch time.
I couldn't get a seat. That's right, not a seat.
Which got me to thinking. This is a market, like the late 1980s and early 1990s, before the dotcom bubble, where people are buying the stocks of companies they like. Panera's packed, buy Panera. Chipotle (CMG), another place I can't ever get a seat, perpetually threatens to hit a 52-week high. It is always beckoning.
Let me add Domino's (DPZ) to the list. Here's a company that is so on the mend that anyone who has ordered from it online in the last year knows that Domino's is undervalued. There is a true tastes-better-buy-it thing going on with Domino's that suffuses the stock trading. I think this is an important development because it will help again to instill the enthusiasm that is necessary for stocks to have a sustained run. There is a terrific self-fulfilling virtuous circle going on with a bunch of stocks and it's such a change for the better.
Of course the cynics would say "that's what a top looks like." But does a top look like 13x earnings? Does a top look like the cheapest stocks have ever been vs. fixed income as Jeremy Siegel pointed out on "Squawk Box" this morning? Does a top coincide with gigantic outflows to fixed income as had been the norm seemingly forever?
That's what you have to think about when you call a top based on dissing those who are acting on their powers or observation.
I sure hope that some of the buyers are doing homework. I know that the people who are left at least understand the concept.
We can't be so cynical as to say that when retail likes something it's the top. In this tape, if retail likes something, call it a good sign!