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September 5, 2005

Stock Market Prediction: Get out

   Folks, I will make a prediction against my interest (I may look very foolish with this later -- and indeed, I hope I do).  The stock market is due for a severe correction.  It may not happen quickly -- it may take a while to develop -- but look for a 15% negative correction over the next year or so.  Increased energy prices, Chinese and Indian products coming on line, the markets blase acceptance of low risk premiums, a slowing manufacturing economy, leveraged fund foibles (chasing the high returns; hiding the bad results), lower consumer spending, heavy short pressure (particularly in the EFTs) -- it all adds up to a correction.  Minimize long positions in stock.

September 5, 2005 | Permalink

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