Where is the Optimism in the economy or stock markets?

Morgan Stanley recently produced a  report saying that there have been net OUTFLOWS in equities from 2010-2015 essentially, EVEN AS THE SPX rose as much as it has.

(see chart of equity flows since 2010 in particular - with few inflow weeks since then).
http://www.businessinsider.com/us-equity-mutual-fund-inflows-2014-8

http://www.morganstanleyfa.com/public/projectfiles/a4da036b-5f43-4891-a27d-ee518764b497.pdf
http://marketrealist.com/2015/04/us-equities-consolidate-current-levels/


Recently the data has included some net inflows into the ETFs and equity market especially when a new high in SPY is hit, but also into high yield bonds!

To me i would ask WHERE IS THE OPTIMISM SO FAR?  I say nil to minimal.

My Reason: Even if the trend of inflows into equities continues we are just at the beginning of optimism, but there is still
a search for yield/risk aversion leading to bond inflows at the same time somewhat negating that.

I think it will be interesting if this trend is a crossover point ... TBA i guess?  But I am still bullish stocks, and bearish bonds.

Ka-Boom!!! The Swiss go to War on Currency - CHF

Recently I wrote a post looking at Leverage and Trading success that I came across, and the observation that the best performers limited their max drawdown percentage risk to less than 50%.  Further the greatest number of net profitable traders held less max drawdown percentage risk at around 30%.

http://investingpsychologyblog.blogspot.hk/2014/12/leverage-bringer-of-destruction-risk-vs.html

"Humans have a great awareness of risk through survival instincts, but this does not seem to translate into the markets!"

I certainly didn't predict the move the SNB made to unpeg, but the observations seem to be borne true, especially when you consider that FXCM users owe FXCM over $300 Million, forcing FXCM itself to seek a bailout to satisfy their fiduciary obligations.

FXCM had even been one of the champions of allowing greater leverage use by traders to the US Commodity Futures Trading Commission review.

http://www.bloomberg.com/news/2015-01-16/fxcm-lobbied-against-leverage-limit-before-franc-trades-went-bad.html

I had a bit of a loss on the USDCHF move, saved largely by stoplosses limiting my risk, but I also learnt a couple of lessons as a result of the "close-call."

1. I will from now on keep my option and any spot positions separate in another account.  Whilst I didn't suffer any option liquidations, I would have been VERY annoyed if those long term options had been closed on me.

2. EVERY Spot position needs a solid stop loss.  Fortunately I had that.  The danger with Risk, is that is is unknowable until you suffer its effects.

3. Forex options are a better alternative to Spot.  These are still alive at least, and not subject to leveraged margin calls.

4. Leverage must be watched like a Hawk, and controlled to levels that allow survival in surprise events, as proven in the chart of trading success and leverage above.

5. VOLATILITY + LEVERAGE = DYNAMITE