- CNBC – Mario Gabelli sees another ‘pocket’ like the ’87 crash ahead — he just doesn’t know when
The market has no margin of safety, but it is OK, Mario Gabelli said. However, investors need to be prepared for “one of those pockets” like the 1987 “Black Monday” crash and 2010 “flash crash,” he warned. He said those crashes were both due to the mechanics of the market.”You’re going to have one of those pockets. I can’t tell you when or what triggers it, but that’s why you have to be prepared,” the chairman and CEO of Gamco Investors said in an interview with “Power Lunch.” While he doesn’t know what the cause may be, Gabelli noted that the May 2010 crash “was a tiny sample of what could occur in the future because of the untested ETFs, the untested flash trading, the untested absence of a buffer known as specialist.“
- CNBC – The rally’s days are numbered, and a day of ‘reckoning’ is coming: Rosenberg
The stock market is at a critical juncture, and it may be time reduce risk, strategist David Rosenberg says.
He predicts economic growth will slow even more as the Federal Reserve resumes its tightening policy.
“The reckoning will be which market has the story right: Is it the stock market that is de facto pricing in double-digit earnings growth or is it the Treasury market with the 10-year yield at 2.3 percent?” Rosenberg asked Thursday on CNBC’s “Trading Nation.” “[The bond market] is really pricing in a completely different nominal GDP growth world.” Rosenberg, who became bullish about six years ago as the U.S. was licking its wounds from the financial crisis, says his money has always been on bonds.