This past Sunday, Aug. 23, my esteemed colleague and chief market analyst here at EWI Steven Hochberg (we call him "Steve" at the office) gave a powerful speech at the 30th Annual San Francisco Money Show. I tagged along to hand out complimentary reading material to his guests.
This was my second time to attend the Money Show; the first was 2006. And while the location was the same, Steve's audience was far different -- as in, a different size and a different attitude. Allow me to explain.
At the 2006 event, the main topic of Steve's discussion asked the question, "Is the Bull Market Here to stay?" This was in the era of B.C. -- Before Credit implosion. Real estate values were still holding up, the financial sector was going gang busters, and the mainstream experts were confident that the whistling sound coming from the global debt bubble was an "isolated and temporary event with little risk of wider fall out."
So, when Steve displayed a series of bearish charts on the overhead projector, you could practically hear crickets chirping among the sleepy, uninterested crowd -- perhaps 30 or 40 guests at most. I watched their faces in vain for some trace of concern in the midst of Steve's insights; such as:
- An "All The Same Market" chart that showed normally disparate markets (junk bonds, gold, silver, real estate, commodities, and stocks) falling in sync as credit contracts.
- A housing market chart with the headline: "The Real Estate Bust Has Begun"
- A chart of the Philadelphia Bank Index with the headline: "The End Is Near" for the financial boom.
There were more like them, suffice it to say: Getting his bearish message across in that time of blind optimism was like telling a crowd of die-hard Nietzsche fans to "go to their happy place."
In the three years since, Elliott Wave International's forecast of a widespread credit collapse not seen since the Great Depression came to pass with startling accuracy. Hence, the main focus of Steve's 2009 Money Show speech: "Is the worst finally behind the global economy?"
This time around, there weren't enough seats to accommodate the number of Steve's attendees. We even ran out of standing room; people were in the hallway outside. They followed Steve's words and charts, furiously scribbled notes by hand, used tape recorders, and laptops.... Then the end came.
Steve thanked his guests for coming and directed their attention to the back of the room where I stood waiting to hand out free copies of the July 2009 Financial Forecast. Next thing I knew, I was literally surrounded by an eager-eyed crowd: the questions flew from every direction: "Should I trade in T-bonds?" "Are emerging stock market on the verge of a major boom?" "Is the bottom in for the U.S. housing slump?" "What is the wave pattern in the Dow?" And on, and on -- to which I desperately repeated:
"I AM NOT AN ANALYST. I just write for them. Help, somebody."
If you want answers, the man whose name is on the top of Short Term Update and the Financial Forecast has them. One week before the U.S. stock market landed at its 12-year low of March 9, Steve's Feb. 27, 2009, STU observed a specific turning pattern to outline a time window for the onset of a major upside reversal. In STU's own words:
"By all indication, this pattern is back on track... the turn will come on or near March 10, 2009. Anywhere in this time period may mark a turn, which will obviously be a market low."