Investors recently made a historic move into stocks as the volatility index (VIX) tumbled to a 6-year low.
Meanwhile, stocks are sitting at their highest levels since 2007.
However, there's something notable about the current trajectory of the S&P 500, which climbed as high as 1,473 on Tuesday.
"U.S. S&P rally from low looks spookily similar to 2007," writes SocGen's
From Edwards' note:
Finally a hat tip to Brad Wishak at New Edge.... The same day the Vix fell to 131/4, the lowest since the zenith of mid-2007 complacency, and the same day the FT reported that equity fund inflows reached levels not seen since mid-2007 -link, Brad shows that the 807 point rally in the S&P from the devilishly worrisome 666 low is exactly the same as the rally from the 2002 low to the mid-2007 peak. Too many coincidences?
If you believe history repeats itself, then now's a good time to be worried.
Edwards maintains his bearish bias towards the stock market.