1. Aggregate Insider Buying and Selling Data:
Of course the amount of insider selling keeps climbing – because the stocks are worth more, not because executives are more bearish. If a VP at Google sells 5000 shares at 600 per share versus a prior sale at 400 per share, did insider selling really just “explode by 50%”? Shush. Insider buying and selling should only be paid attention to at the single company level.
2. Old Men Writing Newsletters:
Old men writing newsletters about “battening down the hatches” and “the New Normal” hear about something called Groupon being worth $5 billion and automatically assume “Bubble” because the company doesn’t assemble aircraft carriers – they can’t wrap their heads around the hundreds of millions in cash flow being generated by a web-based startup with almost no employees, physical real estate or equipment.
3. Equity Mutual Fund Managers:
They’re all over TV and print again, and what’s worse, their confidence is back. They’re crowing their successful investment stories again as the painful memories of 2007-2009 begin to fade. They must be ignored at all costs. They will make projections about cumulative annual growth rates for their portfolio holdings going out 5 years. They will use these projections to justify high valuations and performance chasing. They will smile at you through their makeup from your television screen as if they are 95% long because of a Sixth Investing Sense that only they possess. This is not the case.
They are fully invested because John Hancock and Fidelity pay them to be.
As somebody who’s angling to one day be one of those crankly old men who can’t stand that damn noise the kids are playing these days, I’m not sure I can fully subscribe to number two, but Brown does make some good points.