Thursday, February 7, 2013

Common sense ignored during market tops

I always like to remind clients that, in the run up to the 2000 and 2007 highs, before the significant collapses that followed in the subsequent 18/24 months, markets seemed infatuated in Greenspan and his famous ‘Put’ the same way today’s teenagers seem infatuated with Justin Bieber, investor complacency was off the charts, volatility was at record lows, belief in ‘the system’ was sky high, and positioning was at extremes.

The flashing common sense warning signs were being ignored, if not mocked.