Big Money Managers Are Cautiously Bullish - Barron's 15 comments
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Remarkably, "Big Money" managers surveyed this week by Barron's magazine are unrelentingly optimistic - with 50% saying they're bullish or very bullish about the stock market's prospects through the middle of next year.
Here are some of the survey's key datapoints:
- 62% believe stocks are currently undervalued; 7% think they're still overvalued.
- 70% say stocks will be the best-performing asset class in 2009; 13% favor cash; 11% prefer bonds.
- 21% say financials will lead the way over the next 6-12 months; 17% say energy or healthcare; 1% favor consumer cyclical stocks.
- 10% are bullish on U.S. real estate; 60% are bearish.
- 50% call their current investment stance defensive; 20% aggressive; 30% neutral.
- Overvalued stocks: Google (GOOG), Wells Fargo (WFC), Goldman Sachs (GS), Apple (AAPL), SunTrust Banks (STI), Wal-Mart (WMT). Most-loved stocks: Berkshire Hathaway (BRK.A), GE (GE), Research In Motion (RIMM), Wells Fargo.
- 62% of their equity portfolio is dedicated to large-cap stocks; 20% to mid-caps; 18% to small-caps.
- An amazing 83% say they're beating the S&P 500 this year. Wow.
- 91% expect a recession within the next year, but most think it won't last more than 12 months. 87% believe a U.S. recession will trigger a global one.
- 62% see normalcy returning to credit markets within half a year. Only 15% think it will take more than one year.
- GDP growth: 0.15% in 2008 and 0.49% in 2009. Inflation 3.28% in 2008 and 3.02% in 2009.
- 17% remain bearish on stocks, but only 3 out of 70 see the Dow closing out 2008 lower than Monday's close of 8175, and only one thinks it will be trading below 8000 next June.
- The median estimate is for a Dow close of 10,642 this year - up 14% from current levels, but down 20% on the year.
Salient sentiment:
- "We could have a huge rally. The Fed is pumping up liquidity, and sooner or later some of this is going to find its way into the market. I feel like a kid in a candy store. My biggest problem now is in deciding what to buy." - David Corbin, chief investment officer of Corbin & Co.
- "A lot of money is on the sidelines, but if you're a money manager, you can't afford to be out of the market, because you might miss the comeback." - David C. Hartzell, founder of Cornell Capital Management
- "Portfolio values are declining, home values are declining, the unemployment rate is going up and consumer confidence is waning. While the market has fallen 40%, so have earnings." - Bryan Sadoff of Sadoff Investment Management
- "After the tech bubble burst we had three down years [for stocks]. Two thirds of the economy - namely, consumer spending - is down, so it's hard to grow earnings, and that's bound to put downward pressure on share prices. It's hard to find much to be bullish about." - Jon Fisher, portfolio manager at Fifth Third Asset Management
- "Equity investors will become more risk averse and likely focus on high quality, [buying] 'blue chip' stocks [of companies] that are able to grow their earnings regardless of the economic environment. Plus, many of these companies have and will pay a growing dividend. The new 'Nifty 50' will be back with a vengeance!" - a respondent
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This article has 15 comments:
So if they are (so clearly) lying about their performance, what ELSE in this article is a generally-agreed-upon lie?
Quit being a sucker for these crooks.
On Nov 02 12:22 PM papakow wrote:
> Quote: "An amazing 83% say they're beating the S&P 500 this year.
> Wow."
>
> So if they are (so clearly) lying about their performance, what ELSE
> in this article is a generally-agreed-upon lie?
>
I'm up 42% for the year; down from my highs of 70% +. But I have not doubt that I will finish the year above 70%. This is not some kind of scam to get you off your ... I hope it is incoragement.
If not maybe you should find some other way to make money because if its not working for you. You just don't get it.
For those TA’s interested, please review your charts. What do you think?
seekingalpha.com/artic...
Marc Faber said that Dow may go to 100,000 if they (FED) print enough money. And Jim Rogers is expecting an inflationary holocaust. The 3% inflation for 09 seems quite modest.
jimrogers-investments..../
Let me second your comment. "incoragement." Boy, we all could use some of that... :-))))))