Are You The Sucker The Dow Jones Industrial Average is hovering near the "psychologically" important (but otherwise meaningless) 14,000 threshold hallelujah. Take note: the beginnings of what will invariably turn out to be a tragic story are unfolding. equity mutual funds according to ICI weekly flows data. This means that unless there is a spectacular outflow reported Wednesday, January will mark the first month of net inflows to domestic equity mutual funds since April of 2011.
Similarly, TrimTabs recently noted that a record $77.4 billion flowed into equity mutual funds and ETFs combined last month. Note that this is a far cry from last year. Contrary to popular belief, inflows into equity ETFs did not offset equity mutual fund outflows in 2012 as the two vehicles posted a net outflow of $21 billion between them.
It certainly appears that the retail valentino shoes outlet investor finally came "off the sidelines" so to speak in January though, meaning that home gamers have either been duped by the media into thinking that "Dow 14,000" actually means something, or, after squirreling away 6.5% of their personal income in December, they figured out that the return on their savings accounts isn't even sufficient to keep up with the BLS's understated CPI figure. Either way, the socalled "dumb money" is set to once again violate that timeless investing maxim that no one can ever seem to adhere to: "buy low, sell high."
There does appear to be one group that knows when to sell however: insiders. Nonetheless, it is safe to assume that corporate executives are at least better informed than valentino shoes for sale the average investor and as such, their willingness to unload their shares to the suddenly stockhappy masses should be cause for concern for those who dumped last month's paycheck into the S 500 SPDR (NYSEARCA:SPY) hoping to "ride the wave."
Given that insiders aren't as enamored with Dow 14,000 as the rest of the market, one wonders what they know that everyone else doesn't. Surely they would want to participate in what Baron Capital's Ron Baron promises will be a 100% increase in the Dow Jones Industrials over the next decade. It appears the most logical explanation may be that they (the insiders) are simply unwilling to look past the rather obvious signs of economic malaise and the everpresent tail risk posed by an unstable Europe. This is valentino shoes reminiscent of the situation which prevailed last fall when retail sales suggested an emboldened consumer but capital expenditures hinted that executives were feeling far less exuberant.