Derek Hernquist Doesn’t Get the Need to Predict

By on January 8, 2011

Derek Hernquist, writer of the “Musings of a Tape Reader” blog, is critical of the constant predictions spouted by the pundits. He singles out Doug Kass, while acknowledging he has made great calls in the past, wonders why he makes predictions at all.

Hernquist points out several factors weighing on the bullish and bearish sides of the scale. One thing in particular that disturbs him as far as a continued bullish run in the market that I found interesting:

1) Breadth- I find it odd that on this run to new highs we’ve failed to see even 70% of stocks above their 10 day average. This is VERY disappointing, and is evidence of a narrowing market rather than broadening…and NOT due to the bond market weakness, as I measure this using names that trade actively and with decent range.

SMA Comment: Predictions are made by pundits to keep their names in the popular media. Most predictions are probably best ignored as no one has shown a particular skill in this regard. However, Doug Kass is probably one of the more accurate predictors out there, although he is far from perfect.

Source: Derek Hernquist
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