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Wall Street Economic and Market Outlook 2010

Posted by Larry Doyle on January 6, 2010 12:06 PM |

The New Year brings us the traditional economic and market outlooks from Wall Street firms. High five to a loyal Sense on Cents reader for sharing this recap collated by Birinyi Associates. (Click on image to access full report)

Birinyi

>> LD’s SUMMARY
The overall average calls across the economic and market landscape are as follows:

GDP: +3.1% increase
S&P 500 close at year end 2010: 1222, a 9.6% increase
S&P 500 earnings: $76/share
Oil: $80/barrel, effectively flat on the year
Dollar/Euro: 1.45, effectively flat on the year

The overall outlook does project that analysts believe better opportunities for growth lie outside the United States.

With all due respect to the analysts making these calls, there are no major market calls and especially outliers in this report. Why? Analysts know they have more downside in being bold and wrong. Additionally, the analysts are ultimately a public face for Wall Street salespeople trying to collect assets and sell products. What environment characteristics are most conducive for those pursuits? Low volatility with positive bias and trend. What have the analysts provided? Exactly that.

Wall Street is truly an oligopoly. Group think and coordinated — if not collusive — pricing and projections are simply how the game is played.

LD

  • Sader98

    LD,

    We are broke as a nation; the very idea that the fed went around “bailing out” companies left and right last year became a hoot. I mean, really, who are we to bail out anyone when we are exceedingly breaking new debt levels every year?

    We have printed, borrowed, and spent ourselves right over the edge – we simply haven’t hit the bottom yet. At what point do you foresee the US dollar falling right off? I would be surprised if the dollar holds even against the Euro this year and if Oil doesn’t hit $100+ again in 2010.

    Thoughts?

    • Larry Doyle

      Sader98,

      Welcome to SoC!!

      The problems within certain parts of the Euro-zone are as bad as- if not even worse than – the good ol’ US of A. Ireland, Portugal, Spain, Greece are all disasters. Great Britain does not utilize the euro as its currency, but the pound is also a pig given the fiscal mess there.

      Where does one go? For these reasons, commodities have done exceptionally well.

      What’s the end game? Extend debts and pretend asset values are real. That game of smoke and mirrors lasts for a while, but how long can central banks leave the spigot flowing before currency devaluations occur on a grand scale? What might that precipitate? Serious global inflation.

      One massive game of chicken currently. See my commentary this morning on California.

      Thanks for the prompt.






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