He followed up with a comment on Friday the 13th curse:
My friend makes several interesting observations but I don't share his bearish views. I reminded him that the US economy is the most productive economy in the world, and that productivity ultimately determines the wealth of a nation. I mention this because everyone is still focusing on the dismal US labor market (which is finally showing signs of a rebound) and not focusing on the true successes of American enterprise in both the old and new economy.Markets are tanking today! Numbers were not that bad, Greece is at the same place it was! Suddenly investors care. Aside from that Bloomberg released an analysis of the world's strongest banks -- In the top 15, 5 were Canadian, three from Singapore and two from Switzerland. None of the Canadian banks are rated AAA by Moody's (or S&P) in fact, National Bank of Canada (#3 in the world) is actually rated the weakest (in rating terms).I point this out to make this story funnier, it turns out that Cyprus only two commercial banks have an exposure to Greece of about $30 billion, or about 170% of Cyprus' GDP. Today, everyone is talking write-downs on Greek debt (Duh!) with hair cuts of 40% to 75%. In this instance, a poor country that has not too much sovereign debt could find itself as the world's most bankrupt country in about 5 minutes.
I wonder what rating Moody's and S&P assigned to these two banks???
Another portfolio manager I know told me he attended a recent conference hosted by Steve Drobny of Drobny Global Advisors. He told me: "All the young hedge fund managers were bearish, waiting to make another killing like some managers did in 2008. The older guys were more sanguine, and more bullish. They were long homebuilders because they think that housing woes are concentrated in a few states but that inventories run the risk of being low in the future."
Like I said, I know it's fashionable to be short US, but I'm bullish on both the US economy and the US stock market (keep buying the dips!). On Sunday, I'll follow-up on last week's piece introducing secrets of elite funds.