Winners are grinners and losers can suit themselves. Super bull stockbroker Charlie Aitken was clearly grinning as he celebrated the first anniversary of his big call that the Australian equities bear market was over - an anniversary that he's marked by predicting the S&P/ASX 200 is on its way to 6000 points over the next 12 to 18 months, led by financial stocks setting record highs.
The Bell Potter wholesale managing director displayed no false humility in his letter to clients claiming the big win:
"Good morning and welcome to the first anniversary of the new bull market in Australian equities. I hope you all enjoyed the first 900 points.
"A year ago today I published a note titled 'The end of the five-year bear market in Australian equities'. I was so convinced we had witnessed a major turning point I actually came in to work on Saturday and sent a note to clients which was again republished on Monday. The note ended with 'keep this one today and read it back to me in six to 12 months'."
We won't go that far, but we did report the call and its reasoning at the time and the comments that poured in displayed enough of the deep derision harboured by the pessimists to make Aitken happy.
Aitken's anniversary note pays homage to a quote from the late great funds manager Sir John Templeton: "Bull markets are born on pessimism, grow on scepticism, mature on optimism and die on euphoria." Aitken says Australian equities are now in the "grow on scepticism" phase of a bull market.
"Professional investors remain conservative and analysts remain broadly in bear market mode, still looking to make their name via a negative call. Those that are positive have price targets close to current share prices. Corporations remain conservative while individual investors are only just starting to increase their exposure to equities.
"ASX trading volumes remain somewhat subdued and margin lending is only just starting to pick up. Twelve months after my first lonely bullish call on Australian equities it remains contrarian to be an outright bull on the asset class.
"While the ASX 200 is up 21 per cent in raw terms from this time 12 months ago ... we would have to rally another 34 per cent to recover to the all-time high of 6851. If the previous trends are a guide, then we are in for another 12 months of strong index recovery gains.
"The length of the previous bear market truly is one of the reasons the new bull market is self-sustaining. Extended bear markets test all equity holders' resolve and lead to many equity holders simply exiting the asset class in frustration. As you come out the other side you find very little selling resistance in equities as there isn't a marginal seller. In fact, there is quite the opposite."
Aitken believes cash rates will remain at historic lows and equity demand will outstrip supply as individual Australian investors unleash their current record holdings in cash and fixed interest.
Charlie Aitken then, not uncharacteristically, turns political, believing that the catalyst to change sentiment will be the federal election. A decisive result on September 7 will provide the missing ingredient of confidence.
I had been meaning to write about the one thing in the Reserve Bank governor's speech last week to the Anika Foundation that seemed genuinely and somewhat surprisingly new - a spray about confidence that some might construe as being amazingly political for the RBA. Mr Aitken saw it too, while everyone else was searching for interest rate clues.
It should be read in the broader context of the speech but Stevens dared to venture into the delicate area of business confidence, the other factor that is needed beyond global growth and appropriate monetary and fiscal policy.
"It would be good if there was a bit more confidence in the business community about the future," Mr Stevens told the Anika Foundation.
"Unfortunately, it is not a straightforward thing to turn sentiment around.
"There's no such thing as the 'confidence policy lever'. Rather, we have to rely on: clarity of policy frameworks and objectives; consistent application of policies towards well-understood goals; and, attention to avoiding things that can dampen confidence unnecessarily."