In short, I remain deeply concerned about the next couple of years in both the financial markets and the broad economy, but am also somewhat agnostic about the short-term prospects for both. The significant economic headwinds should certainly temper any inclination to accept a great deal of market risk here, because stocks are not cheap and economic disappointments may bite with abrupt force. At the same time, there is little prevailing evidence to suggest that a major breakdown is predictable or imminent, and internals are still mottled enough to allow for the possibility that investors will recruit new faith based on this or that economic development. We don't want to exclude that possibility, so we have a small 1% anti-hedge in index call options, while at the same time we retain our hedge against any significant market weakness.
Click to read the complete Hussman Weekly Market Comment
Click to read the complete Hussman Weekly Market Comment
