2012 stock forecast - CNNMoney survey
Investment strategists and money managers expect the S&P 500 will rise 7%, on average, in 2012, according to an exclusive CNNMoney survey.
While Schaeffer’s Investment Research’s Ryan Detrick agrees that debt problems will result in ongoing volatility, he’s more optimistic about the market’s overall performance for the year.
“Europe’s problems are obviously still out there, and there’s potential for more curve balls, but we’re making a bullish assumption: things won’t spiral out of control and we will get some good news,” said Detrick, whose year-end target for the S&P 500 stands at 1,450, which translates to an impressive 15% gain for the year.
CNNMoney - Jan. 2, 2012
Bridgewater: Weak growth, but stocks an okay bet
From WSJ: in short, sounds like everything’s still a mess, but you can buy gold, government bonds…and stocks.
“Robert Prince, co-chief investment officer at Bridgewater, and his managers at the world’s biggest hedge fund firm are preparing for at least a decade of slow growth and high unemployment for the big developed economies. Mr. Prince describes those economies—the U.S. and Europe, in particular—as “zombies” and says they will remain that way until they work through their mountains of debt.
“What you have is a picture of broken economic systems that are operating on life support,” Mr. Prince says. “We’re in a secular deleveraging that will probably take 15 to 20 years to work through and we’re just four years in.”
“In the U.S., leveraged investors who can borrow money at rates near zero could find a good deal in Treasurys, Mr. Prince says.
“Gold prices should resume a rally amid continued printing of money by the Fed and other central banks, Mr. Prince says.
“Mr. Prince also thinks stocks are attractive from a long-term perspective, especially compared with bonds or cash. Broadly, discounted earnings-growth rates, which reflect the expectations about future earnings implied by current prices, are negative, he says.
“A moribund economic outlook “is pretty priced in right now,” he says. “If we have a long, drawn out deleveraging process without substantial air pockets, chances are equities are a pretty good bet, ironically.”
Latest White House forecasts
Fed latest forecasts
More Inflation: The Fed’s revised economic outlook showed that overall prices are expected to jump 2.1% to 2.8% this year, significantly more than the 1.3% to 1.7% jump originally forecast.
Less Growth: The Fed said gross domestic product, the broadest measure of the nation’s economic health, is projected to grow between 3.1% to 3.3% in 2011, down from the earlier estimate of between 3.4% and 3.9%.
But also less unemployment: The Fed has lowered its outlook on the unemployment rate for the full year to between 8.4% and 8.7%, down from earlier expectations that it would remain in the 8.8% to 9.0% range.
Fed forecasts for GDP and unemployment
[Note to readers: This is from from a Fed forecast made in February, but I wanted to have in one place for easy access later.]
The Fed estimates that the nation’s gross domestic product will rise between 3.4% to 3.9% in 2011, up from its November estimate of an increase of 3.0% to 3.6%.
The Fed also revised its unemployment estimates for 2011 as well as the next two years. But its new forecast of a jobless rate between 8.8% and 9% at year’s end is only slightly lower than the current unemployment rate of 9% in January.
From CNNMoney, Feb. 16, 2011
Unemployment forecasts — depressing stuff
Economists may be scrambling to lift GDP growth forecasts for 2011 and 2012. But two years out, unemployment will still be a major problem.
From CNNMoney’s economist survey:
Economists now expect 2011 growth of 3.3%, up from an earlier estimate of 2.8%. And they 3.4% growth in 2012.
They expect unemployment to improve to just below 9% by the end of next year, little changed from earlier forecasts, and they’re looking for unemployment to drop to about 8.2% by the end of 2012.
Dangers of a stock market on juice
“The Fed stimulus has been like crack to the market. But this is a really dangerous market right now, because what happens if QE2 doesn’t work and they take it away? We could be in for a big correction if people come out and say it hasn’t succeeded and the whole thing caves in.” — Ron Courser, president of Ron Courser & Associates
Stocks creep into the new year (CNNMoney)
What investors want: A pinch of growth AND Big Government
Zandi and others get optimistic