The Stock And Bond Markets: A Critical Time

A CNBC survey asked 14 global market strategists to give their year-end target for the S&P 500 index. The lowest forecast was for 2,150 (close on May 28 was around 2120.) Most of the other forecasts were just below 2,300, while a number were above that level.

We remember a Barron’s survey of top institutional money managers in early 2008, just before the global crisis. Not one of them forecasted a decline in the stock market for the year, but the year saw the greatest global crisis since 1929.

They were obviously all very, very wrong.

Gold: The War on Gold

We are now seeing a ‘war on gold.’ For the past several months we have been mentioning that the gold bullion banks and the central banks were putting lots of downward pressure on paper gold so as to discourage those who thought that gold was better than paper money.

Although we have been bullish on gold for the long term (i.e. 5 or more years), we turned bearish on the intermediate term. In our Feb. 15 issue of our WELLINGTON LETTER, we wrote: