May

22

The main usefulness of the Fed model is to identify risks in the bond market. Specifically when stock yields are low but the Fed model gives a "buy signal" anyway, it is evidence that bond yields are unusually depressed. That signal is typically followed by poor bond market performance (with no reliable implication for stocks). [More from Hussman]

Victor Niederhoffer adds:

In one sense, it is good to see such information disseminated , in that it's so wrong. Still, it is unfortunate to see because the public might believe such a conclusion and lose so much more than they should. 

Jeff Sasmor adds: 

If you look at this Hussman performance chart you'll see it doesn't show great performance. Reading his commentaries from time to time he reminds me of the permabear in Barron's weekly column. 


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