The market will range between 10% up and 10% down. I don’t know where it will end the year. The U.S. central bank will be forced to quit quantitative easing by the middle of the year as political pressure increases, but it won’t shrink its balance sheet. The ending of QE will take some excitement out of the stock market. Then there is room for unpleasant surprises. From time to time, the Chinese could shock the markets by acting more serious about tightening. I don’t like the widespread optimism right now, and I can’t join the bandwagon. The crisis in Europe is continuing. We don’t know where it will lead and how it will affect the U.S. Corporate profit margins can’t stay at such high levels. They will probably revert to the mean, which historically was 5.5% or so, not today’s 7% - in Businessinsider
Felix Zulauf is an asset manager and hedge fund adviser.