Time to be fearful?

As the year closes, Wall Street starts to come out with predictions on where thr S&P500 will close by the end of next year. You can see the man projections in the chart below. Warren Buffett says that financial projections often tell you more about the person/entity that projects than the projections themselves. All these banks have a vetted interest in the market going up, not necessarily being right. Perhaps it is for that reason that none of them projects a negative result for next year, even after 3 very good performance years. No rest for this market. The lowest one, from BoA, is an anemic 3%, which will basically cover inflation. At the top of the list, Deutsche Bank predicts a 16% total return for the index, 5 times the BoA number. Not one bank of the big ones is projecting a recession, and none of them is even considering that perhaps the AI hype needs a breather. The Goldilocks scenario appears to be: lower rates, no inflation, stable long rates, stable dollar, good corporate earnings led by AI, and stable credit markets. Paraphrasing Buffet again, perhaps it’s time to be fearful, as we can see that the others are greedy.

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