You Lost That Bullish Feeling…

Have a look at the chart below from the AAII.

I’ve included this to show only the bullish investor sentiment readings.

And just as a small reminder before you do: I's great that this reading is low if you’re a long-term investor; and it is by all accounts.  

If you are a trader, interested in missing the next bear market and jumping right in at the next lows guided by the media circus headlines, then this is not the morning note for you.

And There’s More...

For those seeking a second opinion please refer to the below chart.

It shows the Fear and Greed Index from CNN Money covering the last few years:

The bottom box shows what all other sentiment indicators show; that fear is right where you want it to be entering the summer doldrums.  

And did you see the small box in the upper right-hand quadrant of the graph showing the Put/Call Ratio?

This week at Dow Jones 25,400, the masses became far more fearful than they were even on the morning of December 24 2018, as the Dow fell 1,100 points in one a day on "recession fears and trade war concerns," ending the day at Dow 21,700.

And where is all that money going as it "floods" out of stocks?

Ah yes, the bond market, at 43.6 times earnings; nearing historical levels seen only rarely in our lifetimes:

The red arrow (above) shows us that for the better part of the last 18 months we have been told to be frightened about the impending collapse of the world due to rising interest rates, driven by an out of control US Federal Reserve.

And the red box shows you the "terrible highs" in yield (3.18%) reached right before the "recession is coming" panic of Q4.

The green arrow shows where we are as of this week, with lows in yields not seen in 3 years. And yet there are “floods” of buyers at 43 times earnings who are locked in for the next 10 years.

A new wave of corporate bond offerings to soak up all that fear.

And a cheap stock market, but only for long-term investors.