âKostin said there were three main reasons for his call: 1.The U.S. economy is stagnating, growing below trend. 2.In a weak economic growth environment, markets historically have a flat multiple 3.2012 is expected to see earnings growth of only 3 percent.â Per 1, 2+% growth with negative real interest rates is net 3% ie:not below or above trend but at trend. Per 2, His estimate of earnings growth is wrong. Would put it at high single digits. Per 3, growth expectations are 5-8% from analysts I consider credible. Basically his growth estimate is wildly inaccurate, and S&P earnings were up 17% last year, so there's no reason it should be so low. Happy to take the other side of his strategy, but I am more inclined to eye my large share purchase of SQQQ happening soon.
He'll be right after the Tuesday after the first Monday in November, in the meantime he'll be Kostin you money.
#1 Reason: because markets are volatile in nature and 1250 isn't very far from the current price. Why does this sort of beyond-empty prediction even get any attention?
Out of overbought so we'd have to rise a couple percent or if we go down oversold that is about 3% lower.