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Abby Joseph Cohen's view (very funny)

  1. jebigabre

    708 Posts.

    Goldman Sachs Group's chief investment
    strategist Abby Joseph Cohen says investors'
    fears are overdone and that stocks are likely
    to rise within the next six to 12 months to
    the S&P 500's fair value of 1,300.

    She says the basics of economic and corporate
    performance are increasingly sound, companies
    have done an effective job of reducing
    investors' expectations, and the high level of
    accounting adjustments may soon decline.

    Valuation models based on price/earnings ratios
    that suggest stocks are overpriced ignore factors
    such as inflation and interest rates.
    Moreover, the weakening of the U.S. dollar may
    boost exports and profits while encouraging
    structural reforms in other countries, she

    For pessimists, whose dire predictions a year
    ago have been exceeded by the slump, the time
    is not yet ripe for confidence.
    ``Because earnings have eroded so dramatically,
    people are speculating that there has to be an
    earnings rebound...a very substantial
    one,'' said Merrill's Bernstein.

    ``Earnings are improving, but they're not
    improving as rapidly or to the magnitude of
    the consensus view,'' he said.

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