The Simple Accountant

Merrill's David Rosenberg Discusses Corporate Earnings and Market Multiples

I tend to agree with Mr. Bbzz's comments, even though it's heresy for an accountant. The price of stocks and other financial does seem to move with the supply and demand for those assets, and there is a lot of liquidity seeking return, so I tend to doubt that there will be a disastrous decline from here in the broad equity indexes. Just a hunch, based on a trader's instincts.

However, I do think that Mr. Rosenberg has a valid point, as does his colleague at Merrill, Richard Bernstein, who suggests being in high quality bonds and blue chip equities. My own tendency is to think that large cap value, which has underperformed of late, will be a relatively stronger asset class going forward.