by David Kranzler
Investment Research Dynamics
“People were purchasing bulbs at higher and higher prices, intending to re-sell them for a profit. Such a scheme could not last unless someone was ultimately willing to pay such high prices and take possession of the bulbs. In February 1637, tulip traders could no longer find new buyers willing to pay increasingly inflated prices for their bulbs. As this realization set in, the demand for tulips collapsed” – “Extraordinary Popular Delusions and the Madness of Crowds,” – Charles Mackay
“So yes, in a way I’m saying we can keep going up while at risk of reverting at any moment” – NorthmanTrader.com
The market is melting up and indicators that a top is approaching are proliferating. This is one of the typical anecdotes that accompany markets nearing a top: On CNBC last Wednesday morning the hosts plus a couple guests were discussing the market and one of the guests said that value doesn’t matter anymore “it’s all about momentum.” I almost fell off my chair when I heard that because the “fundamentals don’t matter it’s all about momentum” was one of the mantras in late 1999.