Everyone is Waiting for a Pullback in the Stock Market?

       At least according to a CNBC headline.

       http://www.cnbc.com/id/46434016

      "Analysts have been saying for much of February that the market is ripe for a pullback, but the indices continue to rise, taking the S&P 500 close to its 2011 high and the Dow and Nasdaq to multi-year highs."

      “The market continues to work its way higher. We are knocking on the door of the April 29 recovery high. It feels like there are an awful lot of people calling for a correction—or at least a digestion—and I’m one of them,” said Sam Stovall, chief equity strategist at S&P Capital IQ

       The Dow today finished just short of 13000 which is a psychologically important level. If it were able to get above that it would be important.

      "Stovall said with history as a guide, when stocks rally, off a ‘baby bear’ correction, like the one that ended in October, they on average rebound by about 23 percent within six months. The current market rally is ahead of schedule, and stocks have made similar gains in just 4-1/2 months."

      “We think we’re going to get to where we are now, or even as high as 1380 (on the S&P) and then maybe go down to the low 1300s before approaching 1400. That’s the scenario our technicians are talking about,” he said. He said he would then look for a steeper correction in the second or third quarter."

       I'm not going to guess if there couldn't be short correction, but in the long term I think the market is good. This is a very good time to be long America
 
       Thinking about the famous Efficient Market Hypothesis (EMH) that Lars Christensen tried to help out Scott Sumner with this week, I'm not a fan of it for sure. I don't buy it.

       However, it is true that things sure look different than they did during the 2008 bear market. Back then you had the traders on Fast Money declaring buy and hold dead-I thought they were right. However the market has changed. In 2008 the only money to be made was short term-I made some real nice winnings in September 2008-the worst month was the best for trading-shorting the banks.

     I like trading. My preference is not day trading-maybe some can but I can't figure out how to predict such short term moves-but anywhere from a few days to a few weeks is my time frame.

    But things have changed since the bottom of the market in early March, 2009. That March there was a lot of fast money to make as the bank stocks and the rest of the market came back like a rocket. However by April the easy, fast gains were over. Since then patient, longer term boring old stock holding has been the way to go.

    If you had bought Apple at its bottom-or Amazon or Google-you are up a bunch now. Apple is up almost 500%. Even now I'd say the way to go is to buy stocks for the long term. This can't make you rich quick like trading but will lead to gains. I mean Bank of America is at $8. Surely you have little to lose in backing up the truck on that right now-assuming you have any capital. Few do these days. Though things are getting better. Even I have a job now. I'm working the grave yard shift over at this gated community tonight-I'm a security guard now. Low bar to entry if you need something quick.

   If you were to buy in at $8 on BAC if it goes to $12 that's 50% on your money. To be sure it hasn't seen that in over a year. But at some point it will come back assuming that we really are coming back-most indicators point that we are.

   At this point I feel like doing an Irving Fisher and declaring, "The fundamnetals of the American economy are strong. The US stock market is in a permanently high plateau."

   Ok, not the second part really. There is no such thing as a permanent plateau in stocks.