The Five Dumbest Things on Wall Street: March 20

4. Nothing but Bull

This week, we learned of the end of an era, as Abby Joseph Cohen stepped down as Wall Street's chief promoter of irrational exuberance.

Her storied career took off when she served as the vice president in charge of investment strategy at Drexel Burnham Lambert, Michael Milken's junk bond empire, as it collapsed amid regulatory scrutiny in 1988.

Having joined Goldman Sachs in 1990, Cohen rose up the ranks at the investment bank to become its senior U.S. investment strategist and one of the foremost predictors of short-term stock moves on Wall Street.

Cohen had a legendary streak of prescient bullish pronouncements on CNBC and elsewhere in the media during the dot-com mania of the late-1990s. She's widely credited for helping to drive the markets up to towering heights.

When the bubble finally burst in 2000, Cohen managed to steer her clients around the setback by advising them to cut back on equities by a hair without predicting any declines in the S&P 500. It dropped 7% that year.

In 2001, Cohen covered herself with even more glory by predicting a modest decline for the year. She would have been right on the nose if not for the terrorist attacks of 9/11, which dragged the index down 13% for the year.

CNBC named Cohen Wall Street's most accurate forecaster in 2003 and 2004, years in which the S&P gained 28% and 6%, respectively.

Her replacement, David Kostin, may not have received the memo yet. He's now predicting that in the short term, the S&P will fall to 1160. It was recently trading at around 1311. Kostin is forecasting that the index will close 2008 at 1380, down 6% for the year.

Cohen had recently called for the S&P to finish 2008 at 1675--a 14% gain. The Wall Street Journal reported that she now agrees with "Nervous Nellie's" forecast.

"One thing I made clear internally was that I wanted to start working on longer-term issues and didn't want to do the day-to-day market analysis," Cohen told the newspaper.

She's staying on at Goldman as president of its Global Markets Institute and senior investment strategist so that she can be a cheerleader for emerging markets.

Dumb-o-meter score: 79. Let the global boom begin!