Kass: Where I Now Stand By Doug Kass
I view share prices of many companies as having become generally more attractive over the last two months, but, at this point in time, there are four factors that keep me from being more heavily committed to equities:
1. the stock market's
continued volatility and instability;
2. the growing
sovereign debt contagion in Europe (and failure of their leaders/central bankers to respond intelligently);
3. continuing political partisanship (and failure of our leaders to properly confront our fiscal imbalances and to promote pro-growth policy); and
4. an inability to gauge whether the erosion in the August sentiment measures (impacted by U.S. stock market and domestic/overseas economic uncertainties) will translate into weakness in hard domestic economic data.
Scenario No. 1 (probability 15%): The pace of U.S. economic recovery
reaccelerates to above-consensus forecasts
Scenario No. 2 (probability 15%): The U.S. enters a
deep recession precipitated by a more pronounced negative feedback loop, a series of European bank failures and likely sovereign debt defaults in the eurozone.
Scenario No. 3 (probability 30%): The U.S. and Europe economies experience a
shallow recession.Scenario No. 4 (probability 40%): The U.S. and European economies
"muddle through" in a modest expansion mode
http://www.thestreet.com/story/11245827 ... ooyah_html
It's all about "how much you made when you were right" & "how little you lost when you were wrong"