Fund Managers Keep the Faith

Mutual fund managers are finally starting to like what they see.

The surprising optimism was quantified last week in a Merrill Lynch survey of some 300 mutual fund managers. Essentially their message is this: Forget any economic woes; it's all going to work out fine.

Institutional investors are more confident that the Federal Reserve's current monetary policy is just as it should be. Fully 79% of the fund managers polled from Dec. 5 to Dec. 15 think monetary policy is "about right," up from only 56% in November.

In addition, 67% of the fund managers think the global business cycle will get stronger over the next 12 months, up from 42% in November and 37% in October. ...