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 and painful deleveraging cycle,” Hussman writes in a piece entitled “Reckless Myopia” on Hussman Funds’ web site (thanks to The Business Insider for highlighting this.) […]

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 aversion is – if anything – becoming more pointed. Along with credit spreads and the exchange value of the U.S. dollar, the CBOE volatility index […]

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 and Ken Feinberg (down 36%); Ron Muhlenkamp (down 37%), and Dodge & Cox Stock (down 41%). These former value stars found out “that too many […]

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 will most likely trade in a “very wide 25-35% range for months.” Hussman breaks down bear markets in three parts — the “recognition, fear, and […]