This time around however, the ratio is not recovering. It closed last month in February at the lowest CLOSE for a month since May 2001. That is an astonishing TWELVE YEARS AGO. The month of March is still young so the ratio has time to recover but so far it is showing no signs yet of reversing.
Some select shares are either the screaming buy of a lifetime or gold is going to fall further yet. It is unclear just what it is going to take to convince BROADER stock market perma bulls to stop chasing them higher. News that China is attempting to slow its overheating real estate market down was shrugged off like a bad habit in today's session in the US.
I know that many analysts continue to insist that the broader stock market is still cheap. That is their business and their opinion. I believe we are witnessing another speculative mania courtesy of the Federal Reserve. With the Fed having slashed interest rates to practically ZERO and with commodities in general out of favor with hedge funds and other larger investors, stocks are the only game in town to obtain any sort of yield in this insane speculative nirvana that the Fed's policies have created. I suppose the rally in equities will continue until it just doesn't. The tape continues to tell traders to buy the thing.
That of course is not much use as predictions go but these guys are drooling all over their chins while they eagery await any dips in the market to gorge themselves on more equities. Nothing, and I do mean "NOTHING" can disabuse this gang of the current Bullish rage that has seized upon them and will not let them go. Quite frankly, it is stunning to watch this herd mentality grow more virulent with the passing of each and every day.
