During manias, the pressure to conform becomes… well, unbearable. Yesterday, CNBC reported that noted bear Doug Kass put an end to the scorn he constantly received on Twitter:
Doug Kass has had it with the haters and declared his intent Monday to leave Twitter and his 62,000 followers behind.
He has been consistently bearish during the current market rally and has taken substantial heat for his position that stocks are overvalued and headed for a fall.
But he said he’s tired of the constant procession of personal attacks and is packing it in.
This reminds us of the pressure to conform during the housing and credit bubbles from 2004-2007. Prominent bear Fred Hickey wrote the following in the October 4, 2007 issue of his monthly newsletter, The High-Tech Strategist:
Fellow contrarians, it’s gut-check time. As a standard bearer of the camp that believes that the Federal Reserve is not omnipotent, I can tell you that this moment is as difficult as any that we have had to endure in many years. I speak to many of the most hard-core stock market bears (our circle is a small one) and it is clear that their confidence is on the ropes. I’m not sure if I can characterize it as despondency, but it sure is close. I can hear the depression over the phone. Their tone is subdued and there’s an air of despondency.
I’d be lying if I said I wasn’t feeling the pressure.
Someone left me a message this week whining that with the housing market in a total collapse, the Fed will never allow the stock market to fall because the consequences would be so awful. It was his conclusion, therefore, that stocks were destined to go higher. Resistance was futile.
It is the notion that the Federal Reserve is in complete control of the markets that is propelling this latest bout of insanity.
History doesn’t always repeat, though it often rhymes. The near extinction of the bears is perhaps the best sign that the investment winds are about to change as the Fed-induced economic storm clouds build.