WEDNESDAY 9/3/14; Ukraine Cease-Fire Confusion; TOL; Factory Orders; Beige Book; SPX and TRAN New All-Time Intraday Highs; COMPQ New 14-1/2 Year High

The dollar/yen remains above 105 so Japanese exporters remain strong on the weaker yen and the NIKK gains +0.4%. Japan PM Abe unveils a new cabinet trying to reinvigorate Abenomics although the k








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After the closing bell, retailer PVH earnings are a beat boosted by the Tommy Hilfiger and Calvin Klein brands. Drone-maker AVAV nosedives -5% on an earnings miss. Engineering company and LNG facility design and builder MTRX collapses -15% after reporting earnings.

The rampant market bullishness continues. The Investors Intelligence bearish sentiment drops to 13.3% the lowest levels since 1987 when the stock market crash occurred. Sentiment is a contrarian indicator where complacency and lack of fear (low bearish sentiment and high bullish sentiment) leads to a market top while fear and panic, and blood in the streets, is the best time to enter the stock market long. Strategist Anthony Valeri at LPL Financials says the market upside run is not over and US growth “will keep pushing stock prices higher.” Investor Hugh Johnson says a correction may occur but any pull back is in the context of an ongoing bull market. Johnson says, “Maintain heavy exposure to equities.”

A couple of Jack’s chime in with notable permabull “invest for the long term” Jack Bogle repeating his tried and true mantra to always buy the stock market. Bogle says, “PE’s are not overextended.” By his own metrics using actual earnings, Bogle says the market PE is 20 and is not at excessive valuation levels. Permabull Jack Bouroudjian agrees cheering the stock market upside stating the case that stocks are moving up because of earnings and a strengthening economy and not the Fed and other central banker easy money policies. Please hold your laughter.

Newsletter David C Jennet is bullish saying, “investors and analysts are wasting their time trying to prove that stocks have formed a new bubble.” Piper Jaffray maintains an SPX 2100 price target for this year and says, “The stage is set for the broader market to make another leg higher” and “the intermediate and long-term picture of the market remains bullish.” The bullish euphoria examples are endless.

All the bullishness aside, there is a small chorus developing singing a more negative tone. Real estate billionaire and proven market timer Sam Zell says, “Something has to give.” Top line revenue for companies across all sectors continue flat or lower as the stock market catapults to new record highs. Any dissenting opinions, however, are shouted down by the overwhelming bullish consensus. Global traders believe in the power of central banker Keynesian monetary policies as evidenced by the 5-1/2 year record stock market rally off the March 2009 bottom. The Fed (US), BOJ (Japan), BOE (UK), ECB (Europe), PBOC (China) and other nations are running the printing presses 24/7 devaluing their currencies to goose the stock market.

Long traders are raping the equity market upside, with no long-term allegiance to the stock market, since the central bankers keep printing money. The wealthy, that own stocks, have become filthy rich from the Fed and other central banker policies, while the middle class and poor are paying the way and suffering through structural unemployment. The separation of the US into the have’s and have not’s will lead to social unrest in America in the months and years ahead.