Just Say No To Stocks

TINA is not a girl, it stands for “There Is No Alternative” to stock investments.

This is the latest obfuscation by Wall Street. It’s the typical illusion deliberately created at market tops to keep naïve money managers from selling, because that would interfere with the selling and shorting by the large Wall Street firms.

Wall Street never mentions that stocks are vastly overvalued. The smartest money managers say they can’t find anything to buy. They never tell you that corporate earnings have now had an earnings decline for five consecutive quarters.

But analysts in the media always tell you that things will be much better in the second half of the year. However, they never say why. It’s just like early 2008, just before the global meltdown.

And most important, these analysts never mention T-bonds as a better alternative to stocks. And when an outside firm like us does, they say, “why would you want a bond with only a 2% or so yield?”

My answer: to get the capital appreciation as interest rates decline, no matter what the Fed wants rates to do.

In response to a question on a panel at a major conference in early July 2015, I gave my #1 investment idea for the next year: the ETF for T-Bonds. Other panelists yawned.

How has it done? The ETF (TLT) is up 16.5% (early July 2015 – June 9, 2016) versus a decline in the broad NYSE COMPOSITE (all the stock on the NYSE).

It was the same in January 2014, when everyone Wall Street analysts cautioned investors away from bonds because they thought interest rates would rise. My view was exactly the opposite, so we got into T-bond ETFs. Over the next 13 months, they appreciated 51%. Amazing, but true.

Now wouldn’t you rather have the safety of the T-bonds, and a gain of 16.5%, rather than the shocking volatility of stocks and No Gains?

That is the true alternative. Call it “TIBA,” which stands for “The Is a Better Alternative.”

The moral of the story: never follow the crowd!

The next phase in the stock market should benefit the bears, just at the time that so many casual analysts are bullish because some of the major indices have manipulated upward. There is no investment buying. It is all “smoke and mirrors.” Be ready and stay alert.

Wishing you successful investing,

Bert Dohmen,
Founder Dohmen Capital Research, Inc.

Important note: Check out my eye-opening new special report, The China Crisis Is Here. It is a must read for anyone who invests, for money managers, and for business leaders who are dependent on international trade and the credit markets.

As posted on Forbes.com