Not So Bullish

The world has now heard pundits like Laszlo Biryini, Dennis Hartman and others tell them that the market is in a brand new Bull. Among the disbelievers is former Merrill Lynch chief North American economist David Rosenberg. Today on Bloomberg, David, who has long been one of our favorites, expressed the opposite view. He said he was amazed to hear these ‘green shoot’ theories because life now has changed to a paradigm of consumer debt pay-down, one where business managers would not rebuild inventory until they were absolutely sure the recessive economy had turned stronger.

Rosenberg believes that much of the trillions of cash we hear are on the sidelines of the capital markets are actually going to be used to reduce consumer and corporate debt. In that case, the banks would not be a good long-term investment bet.

In any case, I hope we continue to hear from David, who recently returned to his homeland to work with stock-picking wealth manager Gluskin Sheff + Associates in Toronto.

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