State of the Markets

With the economy slowly improving, the fiscal cliff out of the way, Europe avoiding implosion so far this year, and the great rotation trade suddenly all the rage, the question of the day seems to be how much higher the stock market can go from here. Of course there are two sides to this argument. And since I try to be as objective as possible as often as possible, I thought I’d quickly review the key arguments from both sides this morning.

Let’s start with the glass-is-half-empty gang. As I’ve chronicled a time or two this year, our furry friends in the bear camp remain steadfast in their belief that stocks simply can’t go much higher from here. Among the reasons most often cited for remaining negative, there is the overbought condition, the elevated sentiment readings, and what they contend is the generally pessimistic macro outlook.

However, my personal favorite objection to the current level of stock prices offered up by the nattering nabobs of negativism is that the current rally will, just like all others before it since the turn of the century, end in tears…

Read the rest of the report…


David Moenning
Direct: 303-670-9761

David Moenning is the founder and chief investment strategist for, a website dedicated to investor education and portfolio analysis. Mr. Moenning is also President of Heritage Capital Management, a privately owned, investment management firm. Founded in 1989, Heritage is focuses on risk management and an “own the best and ignore the rest” equity selection strategy.

For up to the minute updates on the market’s driving forces, Follow Me on Twitter: @StateDave (Twitter is the new Ticker Tape)

Positions in stocks mentioned: none