This blog post originally appeared on RealMoney Silver on Oct. 15 at 8:46 a.m. EDT.
Over the course of the last six to 12 months, I have had an ongoing dialogue with three individuals who know a lot more than me about the economy and the stock markets. All three, at one time or another, were the top-ranked strategists on Wall Street. To be honest, their collective grasp of the economy and the markets well exceeds almost any market observer extant.
I think they enjoy our dialogues and converse frequently with me, mainly because I provide a reasonably thoughtful and devil's advocate view. And I certainly respect their views and even their guidance, at times.
All three have been bullish over the course of the last two years, though one has recently become a convert to the dark side.In essence, their collective view is that the domestic economic recession will be mild by historic standards:
- The Treasury plan will remedy and ultimately reverse the credit crisis.
- A second fiscal package is being framed and will provide a catalyst to growth.
- The Fed will continue to be a friend of the markets.
- A moratorium on home foreclosures will kick-start housing.
- Today's share prices discount a more-severe-than-average recession.
- A sustained market advance appears unlikely.
- The next several years will provide substantially subpar investment returns.
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