In the past few weeks, as stocks have charged almost 30 percent higher, a consensus has emerged that this is the start of a great new bull market.
Stocks always rally six months ahead of the economy, this chorus goes. Today's "green shoots" of good news will soon bloom into a full-blown economic recovery.
So buy now while you still can!
Or not.
Our guest John Mauldin, president of Millennium Wave Advisors, thinks the "great new bull market" theory is. A bunch of baloney. We're not getting out of this mess so fast, he says. The idea that stocks always bottom six months before a recovery is a myth (he's right). And he'll believe it's a new bull market when he finally sees some progress on corporate earnings.
But won't that be too late to buy?
No, says Mauldin, also author of the popular e-letter, "Thoughts from the Frontline." The great bull markets last for decades, so you'll have plenty of time. Those who bought at "the bottom" in 1974 had to suffer through the rest of the 1970s. So stop sitting on the edge of your seat waiting for that perfect moment to buy and just remain cautious for a while.
And that's the key: Mauldin isn't comfortable shorting now, either. He says the environment is too unpredictable. We all must wait and see what "the new normal" turns out to be.
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