David Rosenberg

If you want to hang with the in-crowd right now, you need to be bullish.

Look anywhere, and there’s more unbridled enthusiasm for stocks than there has been in a long time.

The Dow Jones industrial average is at record highs. U.S. equity mutual funds are seeing massive inflows. Bank of America strategists have created a buzz phrase by calling for a “great rotation” out of bonds and into stocks.

The S&P 500 has risen about 9 per cent this year alone. Yet there’s little sign that investors are scared of a portfolio-bashing correction. The CBOE Volatility index, the so-called fear gauge that falls when investors are feeling calm and upbeat about stocks, sank to its lowest level since early 2007 on Monday.

“Almost every one I talk to is now bullish,” observed long-term bear David Rosenberg, the chief economist at Gluskin Sheff + Associates Inc., in a note to clients earlier this year.

Mr. Rosenberg has become a little less dire of late in his market prognostications. While having little conviction over the longevity of the rally, his investment team recently added some selective equity exposure, mostly U.S. dividend-growing large caps.

“When I take a look at history as an economist, I know that the consensus on any basic indicator usually gets it wrong about 80 per cent of the time. Which means that the consensus gets it right about 20 per cent of the time, and then you have to decide.”