WTF is going on in stocks ... Watch The Flows!

May 7th, 2013

by Chris Kimble

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Think back to 2007. If someone would have told you that almost $600 Billion would be withdrawn from Domestic U.S. stock funds over the next six years? What would you have said to them if they then told you that the S&P 500 would be at all-time highs? "Hmmm" at the least!

At times like this when the Dow and S&P 500 is hitting all-time highs, it is common to wonder if too many people are invested in the markets. Is a decline ready to happen? Does the table below have something to do with the common assertion that "this is the most hated rally ever"?

Stocks hitting all-time highs with outflows does make me question a lot of things, one of them being "what would happen to stocks if they would experience only part of the $1.3 Trillion that bond inflows have seen over the past six years?"

WTF? For sure … which stands for "Watch The Flows!"

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