Contrarian Indicator Bill Miller is Bullish

Today’s contrarian indicator: Bill Miller is bullish and buying shares of banks and credit card companies.

The Legg Mason “legend,” based right here in Baltimore, famous for beating the S&P 500 15 years in a row, is now quite infamous… for buying Fannie Mae, AIG, Bear Stearns, WaMu and Wachovia all the way to the bottom.

This morning, all we can do is cringe. Miller is setting himself up as the historical proxy for the mainstream disaster of the day.

The current “bull market,” reasons Mr. Miller, grasping at straws, is behaving “much more like the rally that ended the 1973-1974 bear market or the one that began off the bottom in 1982 or even that which erupted in March 2003 from the last debt deflation scare.”

Banks, he believes, “have the biggest potential to outperform.” Wells Fargo, Capital One and American Express are his favorite speculations. This guy will chase anything. In response, we’d like to announce our latest additions to the short watch list: Wells Fargo, Capital One and American Express.

Media mogul Rupert Murdoch thinks “the worst is over” too. “There are emerging signs in some of our businesses that the days of precipitous declines are done,” said the man behind Fox yesterday, “and revenues are beginning to look healthier.”

Still, News Corp. is forecasting a 30% drop in profits in 2009.