I know that the GMI has kept me and, I hope others, out of the long side of this market since at least August 2008, the last time that the GMI was 4. I prefer the GMI to be at least 4 before I commit many IRA funds, and especially my university pension, to the long side. Since the GMI fell below 4 in late August, the QQQQ (Nasdaq100) and SPY(S&P 500) have declined 35%, and the DIA (Dow 30), by 31%. During that same time period, 95% of the Nasdaq 100 stocks declined, 36% have declined more than 40%. The biggest losers in the Nasdaq100 component stocks includes such well respected stocks as: RIMM, ISRG, and DELL (each down 63%), and JOYG (-69%) and WYNN (-72%). As to the “safe, buy and hold” Dow 30 stocks; 100% declined in this period, with whopping declines in: AXP (-58%), GE (-60%), GM (-75%), AA (-76%), C (-80%) and BAC (-81%). Do you see why it does not make sense to fight the general market’s trend, as reflected in the GMI!
Speaking of the GMI, the table below shows