Short-term positive, longer-term uncertain

AT any one time, markets can be found to operate in one of many states, ranging from "short-term positive, long-term positive" to "short-term negative, long-term negative" with every possible variation in between.

As it stands now, one might say that Wall Street's rise to many all-time highs this year suggests investors are long-term positive, even if valuation metrics suggest there is a chance of a large correction, in which case the short-term outlook could be negative.

Much, of course, depends on the consensus view. It is sometimes said that all investors are fundamentally bearish at heart, an observation that has plenty of truth when one considers that nobody ever makes money when they buy something but only when they sell it, or that markets rely wholly on the "greater fool" theory for proper functioning.