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Weird Looking Bubbles
As permabears continue to scream about a supposed narrow market that’s in a bubble, their constant complaining ironically makes it a known risk and by its very nature, a less significant one.
Fortunately, while these folks obsess over problems, bull markets quietly go about creating solutions.
The bull market beneath the surface is already addressing this "problem" by broadening participation across the market.
It’s amusing how the market always seems to find creative ways to dunk on the permabears.
So, let’s take a look. I wonder what they have to say about these Bubbles.
$EQAL - Russell 1000 Equal Weight
This ETF holds roughly 1,000 stocks equally, representing over 90% of the total U.S. equities market cap.
Another oddly shaped "bubble," hitting new all-time highs after breaking out of a 3-year base.
Can you imagine being bearish when an ETF representing 90% of the total U.S. equities market cap, equally weighted, is just now breaking out? Couldn’t be me.
$RSP - S&P 500 Equal Weight
If this is what a "bubble" looks like, it’s definitely a weird one. All-time highs don’t exactly scream trouble to me.
$QQEW - Nasdaq 100 Equal Weight
Even the giant tech companies, when equally weighted, are hitting new all-time highs.
Once again, this looks a lot more like a base breakout than a bubble but hey, let me know if I’m missing something.
Stay Bullish Friends
I get it.
I get the S&P 500 is up +20% back-to-back years.
I get we have sky-high national debt.
I get there are geopolitical tensions around the globe.
But here’s the thing: the solution isn’t to avoid investing and yell at the sky. It’s to listen even more intently to the message of the market.
And if any of these concerns were truly troubling Mr. Market, he’d let us know through price.
Right now, the message is clear.
Stay bullish, friends.
Cheers,
Larry