Sorry for Being the Bearer of Good News

I have a childhood friend who loves to rant and complain so much that I jokingly preface giving him good news with an apology. The market feels very much like this right now. The overwhelming sentiment is “cautious”, “we are due”, “valuations are unsustainably high”.

But the truth is our collective memory of the GFC has made sentiment a countercyclical stabilizer, stretching out both the financial risk cycle and the economic cycle. Every time we get a little confident or frothy, the scolds come out and remind us of our ‘irresponsibility’ and we all slow our roll for a little while and digest gains.

When you think the rest of the world is now going thru the same, drawn out, semi-deleveraging lower-for-longer recovery we experienced–which keeps a damper on our speed limit as well–begrudging good news could go on for a long, long time.