Doug Kass: Apple (AAPL) & Gold (GLD): ‘Most crowded trades’

“There is no shortage of strategists and investors who will tell you that stocks are cheap right now. While factually true and historically accurate, like many things in life, there’s a lot more to the story than just the headline. For Doug Kass, President and Founder of Seabreeze Partners, a truer headline would read, ‘stocks are theoretically cheap,'” ETFDailyNews reports. “It is a seemingly small quantification but nonetheless one that acknowledges the historically low price-to-earnings ratio is currently low for a reason. And according to Kass, that reason is a swirl of domestic, global, economic, and political headwinds.”

“‘You have to respect the advance and be mindful that the market has limited upside opportunity,’ Kass says in the attached video. ‘There are so many structural issues that face our domestic economy; the Eurozone, issues about whether China is going to have a hard or soft landing, they all impact valuations,'” ETFDailyNews reports. “This, from the man who a week ago wrote that the ‘most crowded trade’ was being out of the market, right before a flood of money came rushing back in, fueling the market’s current rally. Interestingly, on Tuesday Kass wrote on Twitter that he was cutting his long exposure to the stock market to 50% from 70%, in a move of classic contrarianism.”

ETFDailyNews reports, “This week Kass told an audience at the Big Picture Conference at the New York Athletic Club that the most crowded trades are Apple (NASDAQ:AAPL) and Gold (NYSE:GLD). He said gold is a lot like religion, ‘either you believe in God or you’re an atheist. The same applies to gold.’ He believes that gold prices are entirely sentiment driven, and therefore, impossible for him to value.”

See the full “Breakout” interview here.