We are nowhere near that, he adds.
Why?
Hennessy says none of the dangers of a bear market are present. “The fundamentals just keep getting better and better.” He also adds there is none of the “market euphoria” that he has seen just before market crashes.
In fact, he notes, many investors are still a bit conservative. There are, Hennessy noted, “trillions of dollars in bonds and cash funds that could be invested in the stock market."
Hennessy is a value manager who heads a $5 billion fund complex. He says he buys based on price to sales instead of price to earnings. Earnings, he argues, can be distorted. Sales rigging is tougher to do.