FT video on the average failure of forecasters to predict S&P 500 returns

[racemize]

mostly fun just for the first graph he shows:

 

http://video.ft.com/2789599354001/How-to-forecast-the-S-P-500/editorschoice

[Phaceliacapital]

Thanks!

[Packer16]

Great illustration of a contrary indicator.  Let hope strategists call for a decline in 2014.

 

Packer

[racemize]

Great illustration of a contrary indicator.  Let hope strategists call for a decline in 2014.

 

Packer

 

Apparently calling declines isn't allowed (I guess on average?).

[ERICOPOLY]

I believe A. Gary Shilling was at the Fairfax dinner/meeting this year, predicting a market decline.

 

He has been right sometimes, but take a look at this one from 10 years ago:

 

4/14/03 I foresee real returns of 5% to 6% a year on stocks. But while “real” usually means “inflation-adjusted,” in this case, it means “deflation-adjusted.” Nominal returns will be 4%, including reinvested dividends, and deflation will add 1% or 2% a year…

 

http://www.cxoadvisory.com/3767/individual-gurus/gary-shilling/

 

 

Or this one, also from 10 years ago -- he forecast corporate profits rising only 1% a year:

 

6/23/03 On balance, in the years ahead, count on low corporate earnings growth. If you assume that I’m right with my mild deflation forecast, Treasury yields will decline enough to justify current p/es. Then stock prices will go up about 1% annually–only as fast as profits rise over the next decade. 

[Valuebo]

So, any 2014 predictions in yet? ;)

 

 

http://www.bloomberg.com/news/2013-12-23/bull-calls-united-in-europe-as-strategists-see-12-gain-in-2014.html

 

Auwch! That is of course for Europe but still worrisome.

 

 

I've bought some puts as portfolio insurance lately and at this speed I'll likely restock and increase my put position somewhere in the next 4-8 months.

[bmichaud]

Here is Hussmans latest on the probability of a market crash.

 

http://www.hussman.net/wmc/wmc131230.htm