Trade Alert: Everybody’s Confident

I have spent the last two months crisscrossing this country and meeting with dozens of Wall-Streets, hedge fund managers, brokers, sports agents, celebrity publicists, executives from publicly-traded companies, and talking with lots of Uber drivers too. The single most obvious recurring theme is the confidence that people seem to have right now.

I can’t remember a single meeting in the last two months in which someone said that they were going to hold off or not invest or think about things until the economy improves or policies are changed. Most of the time you do hear people at least worried about some sort of crisis du jour.

In some ways as I have been saying for the last two months, this time reminds me of the year 2000 or the year 2007 when bullishness was pervasive, confidence was everywhere and the stock markets were at all-time highs. Does that mean this is the top and that we are about to have a 2001 and or 2008 like crash in the markets? Probably not. Simply put, as Mark Twain once said “history does not always repeat but it does rhyme.”

Similarly, the buzz, excitement and attendance of this week’s Traders Expo here in New York City are all through the roof.  It is usually not an indicator of a stock market bottom when the Trader Expos, and investment conference are full of hype, confidence and attendance. Again, that does not mean that we are instantly about to put in a top. But let’s remember that we were buying when confidence, hype and attendance at trade shows were at lows.

I am about to give a talk at the Traders Expo this afternoon called “Flip it: Everything You’re Doing is Wrong.” I am going to talk about why daytrading, penny stocks, short-termism, economic dependence, consensus and emotions are the enemies.

I am going to go ahead and buy some more $IWM puts that will expire in August with strike prices around $135.00 or so. Just a little bit more hedging.