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Investment Analysis Clubs / Macro Economic Trends and Risks


Subject:  Re: Catastrophe theory, instability, risk Date:  10/10/2012  2:32 PM
Author:  yodaorange Number:  405703 of 499584

I have added my answers to Wendy’s excellent questions. My apologies for not better explaining my position in the first post.

Does this mean that you are now a bull?

No, I certainly am not a bull. I try to always consider a range of outcomes. My median expectation is a broadly flat market for the next 5 to 10 years. Jeremy Grantham published his latest 7 year market forecast yesterday (10/9/12). [1] He is forecasting the SP 500 to return 0.0% real assuming 2.2% inflation. I agree with his forecast.

Do you believe that the Fed's QE infinity forever will control the business cycle, over leverage, malinvestment bubbles?

I would not use the work control, but given 5 to 10 years, the Fed’s goal is to “moderate” the business cycle, over