Here's Why The "Bad News Bears" Are The Dumb Money
By John Persinos
My colleague Robert Rapier wrote an insightful Investing Daily article, published April 30, that underscores how CNBC often provides misleading financial advice.
I'm reminded of what comedian Jon Stewart once said: "If I had only followed CNBC's advice, I'd have a million dollars today, provided I started out with 100 million dollars."
During the trading day, I usually keep the television in my home office tuned to CNBC, but mostly for the raw data. I also watch for contrarian indicators. For example, if Jim Cramer starts jabbering like a chihuahua about the wonderful prospects of a certain stock, it might be time to short the stock.
I've noticed in recent days that the immaculately coiffed pundits on CNBC have been warning of what they call an impending "tech wreck," due to excessive valuations and elevated interest rates.
"Tech wreck" makes for a catchy phrase on a chyron. I always assume that such predictions from the network will have scant bearing on what actually happens.
Sure enough, tech stocks have surged lately, especially as quarterly earnings from most of the sector's large caps beat expectations on the top and bottom lines.
Consider tech mega-cap Tesla (NSDQ: TSLA). The electric vehicle maker's stock surged this week, playing a significant role in boosting not only the tech sector but also consumer discretionary stocks. TSLA jumped 15.31% on April 29 alone, on news of tentative approval from Chinese regulators for its Full Self-Driving technology.
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