Hussman: Four Factors Pushing Us Toward a Double-Dip

In his latest weekly market commentary, top fund manager John Hussman says four factors are indicating that the U.S. is on the verge of a double-dip recession. “In every instance we’ve observed these conditions, the U.S. economy has either already been in a recession, or has been within a few weeks of what turned out in hindsight to be the official beginning of a recession,” Hussman writes. “There have been no false signals.” The four… Read More

Hussman: More Trouble Ahead

Top fund manager John Hussman is seeing more trouble on the horizon for stocks. Hussman tells Bloomberg that there has been “strong deterioration” in market internals, and that such deterioration has historically been followed by market declines over the next 12 weeks and the next 12 months. [youtube=]

Hussman: These Dips Don’t Offer Much Opportunity

Despite the market’s recent struggles, John Hussman — whose funds have some solid long-term track records — isn’t seeing a great opportunity to “buy on the dip”. “My impression is that the market remains in a tenuous state in that we have not meaningfully cleared the overextended syndrome that has been with us in recent months,” Hussman writes in his latest market commentary. “We’re certainly not inclined to ‘buy the dip’ to a material extent,… Read More

Hussman Defensive as More Credit Woes Loom

John Hussman is continuing to maintain a defensive position on stocks, saying that two dangers — an overbought, overvalued market and the coming to roost of a second wave of credit losses — mean investors should be cautious. “It is important to note that our current defensive position is driven by the present combination of overvalued, overbought, overbullish conditions, coupled with upward yield pressures, and is independent of my larger concerns about the potential for… Read More

The Price/Peak Earnings Ratio: A Different Take on Valuation

With stocks up some 60% off their lows, one of the big questions among investors has involved the market’s current value. Are stocks now overvalued? Or are they still cheap? The issue of valuation is one that can be looked at in a myriad of ways — currently, for example, the 10-year price/earnings ratio pioneered by Robert Shiller shows the S&P 500 to be valued at levels above historic norms. So does the more frequently… Read More

Hussman “Cautiously Pessimistic”

Hussman Funds’ John Hussman says he’s fully hedging his Strategic Growth Fund, seeing the recent market weakness as a “natural (though unpredictable in timing) clearing of the previously overextended market condition.” In his latest market commentary, Hussman says it’s not impossible that this clearing phase is over, “but it would be uncharacteristic, particularly since we’ve seen a lot of technical breakdowns, and our broad measures of market internals are negative.” Hussman has a couple main… Read More

Hussman: 80% Chance of 2010 Plunge

John Hussman, whose funds have some of the better long-term track records in the industry despite missing out on much of the ’09 rally, says he sees an 80% chance of a market plunge and economic downturn in 2010. “This is not certainty, but the evidence that we’ve observed in the equity market, labor market, and credit markets to-date is simply much more consistent with the recent advance being a component of a more drawn-out… Read More

Hussman: Good Values, but No Bottom

John Hussman, whose Strategic Growth and Strategic Total Return funds were some of 2008’s best, is warning that major volatility may soon return to the stock market. “I suspect that the markets are about to get volatile, possibly to an extent beyond what we observed in October and November,” Hussman wrote in his latest market commentary on Hussman Funds’ website. “When the markets break support with broad uniformity and few divergences, it suggests that risk… Read More

The Stars — and Fallen Stars — of 2008

Kiplinger’s Fred Frailey looks this week at how some of the world’s top money managers got hammered by the recent market crash, as well as at how other noted managers lived up to their reputations and avoided the plunge. According to Frailey, some of 2008’s big-name losers have been Legg Mason’s Bill Miller (down 59% as of Oct. 30); Longleaf Partners’ Mason Hawkins (down 47%); Oakmark Select’s Bill Nygren (down 36%); Selected American’s Chris Davis… Read More

Hussman: Market Undervalued, But Rally Won’t Last

John P. Hussman, Ph.D., president of Hussman Investment Trust, thinks the market is “undervalued” and guesses “that the general tenor of the market may remain tepidly positive for a few more weeks”. But, he warns we may “ultimately observe another frightening leg down in the first part of next year –- possibly to re-test the November lows”. Hussman doesn’t think the economy will begin to recover until the later part of 2009 and thinks stocks… Read More