Quote of the Day: “This Will Eventually End Badly”

Here’s what I said about Scott Minerd in my January post tilted “Quote of the Day: Possibly the Year!

“If Guggenheim’s Scott Minerd is anything, he’s objective. He’s never one to sensationalize or to wed his ego to his thesis. While he and I haven’t always been on the same page over the years, I’ve always viewed him as being thorough and thoughtful in his approach to markets, and, therefore, credible.

Please pardon my cynicism, but I find the above traits to be all too rare among today’s punditry.”

Here’s some of what he said in yesterday’s note to Guggenheim’s clients (I highly recommend you read it in its entirety):

“This will eventually end badly. I have never in my career seen anything as crazy as what’s going on right now. It was crazy in 2006 when I was pounding the table saying we were going to have a financial crisis of biblical proportions. And it was crazy in 1997, when high yield spreads got as tight as 239 basis points over Treasurys in October of that year, and then zigzagged their way higher for five years, until they peaked at 1,036 basis points in October 2002.”

“We are either moving into a completely new paradigm, or the speculative energy in the market is incredibly out of control. I think it is the latter. I have said before that we have entered the silly season, but I stand corrected. We are in the ludicrous season.”

Yes, he and I are on the same page these days! 

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