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Monday, June 1, 2009

Bob Brinker's Forecasts Wrong on Bear and Wrong on March Market Bottom

Bob Brinker's "Timing Model" failed to predict the arrival of the worst bear market since the Great Depression.

Moneytalk, April 26, 2009, Bob Brinker said: "We've remained in the market. I did not make a call to get out of the market."

How much money did Bob Brinker's subscribers lose if they followed his advice to remain fully invested in his Marketimer Model Portfolios from the stock market high to the stock market low? If they had the courage to look at their statements, this is what they saw:

Bob Brinker's Model Portfolio I:

Value on October 1, 2007 = $302,561; Value on March 1, 2009 = $143,938

Bob Brinker's Model Portfolio II:

Value on October 1, 2007 = $241,994; Value on March 1, 2009 = $119,105

Model Portfolio III (more than 50% bonds):

Value on October 1, 2007 = $219,263; Value on March 1, 2009 = $147,013

Brinker pronounced several market bottoms in 2008 that were speedily taken out as the market continued to decline.

In January, 2009 when the S&P was @ 931 (just two months before the market bottomed at 677), Brinker predicted that the November low would be the market bottom -- in the 750 to 850 range.

In the February 4,
2009 Marketimer (S&P @825.88), referring to NEW money, Brinker said: “….purchase in the low-to-mid 800’s”

In the March 5, 2009, Marketimer (S&P @ 696.33), Bob Brinker said: “Due to the fact that the November 20, 2008 S&P 500 Index closing low failed to hold during the testing process, we believe a new bottoming process will be necessary for a sustainable market advance, we need to see a sequence of events consisting of (a) the establishment of an initial closing low; (b) a short-term rally; (c) a test of the area of the initial closing low on reduced selling pressure."

So there you have proof that just 4 days before the ACTUAL market bottom, Brinker published that he believed a new "bottoming process" would be necessary and he even laid out the "process," which of course, never happened.

Moneytalk, April 26, 2009, Bob Brinker said that he was "on record" recommending "buy on weakness," and he added that he had written that advice in his April Marketimer. That is correct. In March, he was looking for a new bear market bottom, yet Brinker inferred that this had been his unchanging advice for quite some time: "Well our recommendation to our subscribers has been to be a buyer on weakness. We have regarded the market as a buy on weakness. That is our view and that's certainly a view that has not changed in recent weeks."

Is that playing fast and loose with the truth? I report, you decide from the March Marketimer quote just above.

As of today, the S&P has risen about 28% since the March low. Where was the weakness?

SJ Al sent these pictures that he took at the Pensacola Naval Air Museum:


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