Hey Guy, Not Everything is a Contrarian Indicator

by Johnny Debacle

Lately, we’ve witnessed a trend towards an increasing an amount of things being hailed as Contrary Indicators. Recent examples include the cover of the Economist (cover says “Wall Street: A Ten-Page Report on the Crisis), the Bearishness of analysts, our own Time Barrons Investing Thesis and the list goes on. Here’s a news flash — almost nothing is actually a contrarian indicator. That’s right. Easy to assume, difficult to prove. Most things are just noise. Just preemptively, here is a list of things that are not contrarian indicators.

  • Everyone saying it’s a bottom
  • Everyone saying it’s a top
  • Everyone saying they’re a top
  • The fact that the Democratic party has been labeled a shoe-in to win the Presidency
  • A comet hitting the earth (“time to go long solar energy!”…idiot)
  • The US winning a Gold in Karate Chops at the Olympic Games this summer
  • Everyone agreeing that dragons really do/did exist
  • And lastly, everyone thinking that we are not at risk from squids (we invest in squids on their fundamental merit, not because they are a contrarian play)
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