Search Bob Brinker Blogs

Tuesday, March 24, 2009

What did Brinker say six years ago when the S&P closed at 807, like it did today?

Posted March 24, 2009: First, what is Bob Brinker's latest advice?

Let's take a closer look at what Bob Brinker said to a caller about the stock market on Sunday -- the only time Brinker discussed the stock market this past weekend:

Caller Jim said: “I’m 46. I saw that the market was going up in 2006 and it wasn’t correcting. So I moved everything into fixed funds, guaranteed stuff. Is it time for me to get back into the stock market with my allocation?”
[Honeybee EC: This subscriber acted on his own. Brinker has not recommended moving ANY money out of stocks since Year-2000. It would have shown great honesty if Brinker would have told this caller his usual, "that was not my recommendation," but as you will see, he did not do that. Another noteworthy point, Brinker said that the "secular bear megatrend" ended in June 2006. However, he didn't make that pronouncement until June 2007.]

Brinker answered:
“Well, Jim, I think the first thing you have to ask yourself is what is your tolerance for risk. I mean do you have the tolerance for the volatility that occurs in the stock market?" [Honeybee EC: Whew, is Brinker right on this one. Following his recommendations to stay fully invested from S&P 1565 down to S&P 676 takes some high-powered risk tolerance.]

Jim said: “I probably don’t personality-wise, but I’m thinking this is a buying opportunity.”

Brinker said:
“Well, I think what you should do is you should definitely, if you feel as though you have room in your risk tolerance to have a portion of your portfolio in the equity market, then I certainly would get started on that. And you can certainly put money to work in here...."[Honeybee EC: Brinker's most recent new-money-in buy signal was at the low-to-mid 800's, but he said nothing as the market dropped through the 700's and into the mid-600's -- the intraday low was 666.]

Brinker continued: ".....I mean, the market is actually fairly close to its closing low right now. The closing low on the S&P is 676. We’re looking at a market right now trading in the 768 area. You’re looking at a market that has lost half of its value relative to where it was less than two years ago. So I mean in the broad context of accumulating an equity position, I certainly would not have a problem with that for you -- if you, again, if you feel you have the tolerance for risk to do so and that would be the key.”

Ironically, the S&P closed at 806.24 today -- EXACTLY where it was six years ago when Brinker returned all cash reserves to fully invested and said this:

April 5, 2003 Marketimer, Bob Brinker said: "On March 11 [2003], the Marketimer stock market timing model returned to bullish territory for the first time since January of Year 2000. In our view, on March 11 (DJIA 7568; S&P 500 Index 807), the market reached the vicinity of a major cyclical bear market bottom....."

For those who come into new money, here are Brinker's recommendations during this mega-bear market:

S&P 500 Index:

Mid-1400's -- Bob Brinker says buy.
Mid-1300's -- Bob Brinker says buy.
Mid-1200's -- Bob Brinker says buy.
Low-to-mid 800's -- Bob Brinker says buy.
All through the 700's -- Bob Brinker does not say buy.
Mid-600's -- Bob Brinker does not say buy.

The S&P has climbed over 23% since its low of 676 and is now back in the low-800's -- back up to Brinker's last buy zone. Better hurry. 8~)

Brinker's followers don't have to worry about Brinker's market-timing. For his model portfolios, he joined the "church of buy-and-hold" in 2003. LOL!

Chart courtesy of Kirk Lindstrom [LINK]:

Dixiegeezer sent this picture of a beautiful white robin. I have never seen one. I'm sure they are rare:


Top Rated Newsletter

Timer Digest Features
Kirk Lindstrom's Investment Letter
on its Cover

Cick to read the full page article!