Fisher: Ignore The Pundits -- And Sentiment Surveys

Top strategist Kenneth Fisher says that when it comes to stock market and economic forecasters, the best thing you can do is ignore them.

“All this is more proof that listening to short-term media headlines can steer you wrong,” Fisher writes for Interactive Investor, discussing how many forecasters misread recent U.S. and U.K. leading economic indicator data. “Even when watching improving real-time data, forecasters often rely heavily on past releases, backward-looking data and their own biases — so while leading indicators improve, they complain rising stocks aren’t supported by fundamentals. It’s a bubble, they claim. Stocks have come too far too fast. Listen to them, and you’ll end up poorer.”

Fisher says consumer confidence and other sentiment surveys are also poor predictors. “They measure, badly, how people feel about what happened before — they don’t tell you what’s happening now and say nothing about the future,” he says. “Punditry opinion and sentiment surveys are just that — a look at people’s faulty feelings. That’s no way to forecast markets.”

Fisher says the best thing to do is ignore pundits and confidence surveys “and form your own conclusions based on actual data. And not just one month’s data. Instead, take your own longer, global view and assess if the world is better or worse than many think.”

When the world is doing fine and most people don’t see that, it’s a great time to invest, Fisher writes. He says that’s the situation right now, and examines a couple stocks he likes.

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