What will the next 6 months bring for the stock market * your predictions*

Discussion in 'Wall St. News' started by mahram, Mar 19, 2006.

  1. I was wondering what you guys think will happen with the stock market, and markets in general. With hurricane season starting up again in full force, iraq plumeting into civil war, bush threatening to bomb iran, and the democrats threatening to take over the house and senate, what will happen to markets? In the last case if the democrats take over the house and senate, bush's tax cuts and dividend tax cuts are jeporadize, so does that mean the markets will dive after that.
  2. With iraq in chaos for 2 years now, you can pretty much fade that item except for the bond market as long term borrowing requires additional debt creation, putting up pressure on long term rates.

    Last time we had the dems in office, the equity markets soared, and since the republicans have abdicated their stand as the party of fiscal responsibility (somewhat), a democratic victory might be felt by the population to be bullish (as in euphoric) but only on psychologic terms.

    It will be hard to fully repeal those tax cuts except in times of fiscal crisis (OTOH, that 'crisis' might be engineered). And despite tax rates, where else are you going to put your money? Getting rid of dividend and cap gains favoritism might introduce further volatility into the market, as there would be no reason to hold a dividend producer or wait a year for cap gains tax rates vs. trading in and out more frequently for added profitability. It probably screws the buy and hold investor (i.e. the sucker) into not buying and holding, and that might not be in the interest of more efficient (in taking your money, i.e.) capital flows. More likely the changes are taken on the back end with estate taxation, whereby we could probably pay off the national debt and then some.

    I think it is instructive to ask this question - why isn't the market lower, when we are all so bearish?

    Any minor catalyst of good news, after the bad news bears of the bush administration, might send capital markets soaring, on nothing else but sentiment.

    Are we at a turning point? I am not sure.
  3. next 6 months = 100% up room..

    reason... = market not allowed to go down $$
  4. I never try to predict 6 months out, except maybe for fun.

    Predicting stock market movement is similar to weather prediction. Anything longer than 3 days involves a lot of guesswork. Once you reach three weeks or more, it is close to random.

    That is why nearly all mutual funds have trouble beating the market over the long term.
  5. excellent question...now who is left to sell the market :)
  6. semi controlled choas, Im talking about lebanon, bosnia, cheynia type civil war. Where sunis and shias are fighting against each other openly. I cant imagine the united states staying in iraq under those conditions. But George Bush said he will stay in iraq, civil war or no civil war this weekend, so Im guessing he will probably have to increase forces up to 500 K ground forces. and its not a repeal of the tax cut, as I understand its an extension or make permanant. The dividend and tax cuts would just expire. Well the markets are hoping bernake will stop raising interest rates. But I guess we will have to see what happens tommorow.