Not Ready to Ditch The Umbrella Yet

Maybe it is because of record rain fall this spring on the East Coast but as soon as the sun came out people forgot about their wet homes and flooding.  While it is great to be optimistic and I hope the rains won’t come again, it reminds me of the markets and the sun shining on them.  I am more cautious than most, in the short run, and think investors are too optimistic about the economy and the markets.

A “cloud on the horizon” is not one of my favorite metaphors but it works here.  So I will discuss these “clouds” or concerns one by one.

The market has run up too quickly, in my view, with regional banks gaining over 35% year to date on unsteady data. Sure earnings look good but how could they look worse than last year at this time! While some banks are seeing a peak in …