Mainstream economists keep pushing back the date of the expected recovery:
The economists, many of whom have been continually surprised by the depth of the downturn, also pushed back yet again their forecasts for when a recovery would begin. On average, they expect the downturn to end in October. Last month, they said the bottom would arrive in August. They estimate that U.S. gross domestic product will continue to contract in the first half of this year, with slow growth returning in the third quarter…. Amid all the gloom, there is a bright spot: Four-fifths of the economists said now is a good time to buy equities, especially if the investor has a long-term view.
It’s going to be years, not months, gentlemen. And next year is when everyone finally begins to realize it. The concept of economic gravity really isn’t that difficult. The economic contraction will be roughly equivalent to the economic expansion. Since the economic expansion was considerable, so too will the contraction be a sizeable one.
I don’t even see any need to score another point versus the so-called experts on their newly revised forecasts since they were so obviously wrong in the first place. There will be a bounce back in the markets sooner than later, but don’t get taken in by all the calls of a bottom. It’s merely going to be an extended bear rally; 400-point up days are indicative of an ongoing bear market, not the end of one. It is probably a good time to buy stocks… as long as you’re planning to sell them in the fall.
But all you need to know that the mainstream economists are going to be hopelessly wrong can be summarized in this single sentence: “More than 85% of the economists agreed that the central bank’s proliferating lending programs are well-designed, well-executed and helping the economy.”