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Thursday, October 30, 2008

Bob Brinker Raging Bull vs Steve Forbes' Prediction

Bob Brinker was bashing bears and a raging bull when Steve Forbes was predicting a 3000 point drop in the Dow last October at the market top. Brinker said that Forbes was "proven wrong," but look who is laughing last!

From my October, 2007 Moneytalk Summary: Steve Forbes' (prescient) Prediction: May see a 3000 point loss in the Dow, similar to 1987.......Fed needs to soak up excess money it created in 2004, 2005, otherwise there will be a flight from the dollar. Brinker said that Forbes' prediction has been proved wrong because the market just closed at an all-time-high.

Here are some more Brinker-comments that he made during the October, 2007 stock market high:

Stock Market is Recession Gauge: “You don’t a get record run on the stock market on the precipice of a recession – it doesn’t happen........ “Those predicting recession are full of soup.”

Negativity in a Bull Market, Bob Brinker said: “Completely unjustified because in a bull market, you want to be invested. You want to be making money while the sun shines. And when you’re out there with this doom and gloom, it’s counter-productive and extremely costly.” “They don’t know what they are talking about.” Negative “talking heads” make “fools" of themselves because they don’t study “stock market history.”

Bob Brinker also said that the bad news bears in the financial community are spreading “idiocy” and “nonsense” about a recession – it’s “fiction.” “There is no recession and there is no prospect at this time of a recession.”

Brinker was also recommending "total return" stock market investing as preferable to "dividend products." Total Return Investor: “….can invest in the total stock market, which has certainly outperformed any of these dividend products. You get less cash dividends, but you can liquidate shares to make up the difference.”

Honeybee opines that anyone who followed that advice, coupled with sinking all new cash into the stock market at Brinker's mid-1400's "attractive for purchase level," must be feeling some real pain after a 45%+ market decline.

Read the full summary.

This is almost beyond belief! On October 13, 2007 I posted this:
SUB-PRIME LOANS ADJUSTING NEXT YEAR: Will lenders perhaps freeze rates? Bob Brinker said: “I don’t think anything is going to happen to the general market place. Not anything that will affect the general level of rates, however, the Democrats want to bail people out of bad loans.”

Yesterday, Steve Forbes predicted a six-month recession. Here are some Forbes' excerpts from an interview with CNSNews. com:

Steve Forbes: “I think one of the things to keep in mind is that this was a totally unnecessary crisis. There were a lot of problems out there, but they shouldn’t have threatened the very financial system here and around the world. Big mistakes were made. The first one was the federal reserve printing too much money – debasing the dollar, weakening the dollar, that always leads to problems. That was big mistake number one. Sort of like the equivalent to flooding the engine of an automobile. You can have a fine vehicle, but if you abuse it with too much fuel, you’re going to have a problem.

Already, real damage has been done to our economy and around the world. We are in a recession. We will be in one for about six months or more. But if we continue with these recovery programs and don’t do anything foolish like raising taxes or going on another round of trashing the dollar, by spring we should start to see signs of recovery.”


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