by Terry Woo,
Renowned economist David Rosenberg said the S&P 500 could breach the 12-year low it reached in March. Why so glum? Because the economy hasn’t recovered and consumer spending remains weak.
In a Bloomberg television interview, Rosenberg said he’s keeping an open mind and doesn’t know for sure if the index will test a new low. But he isn’t convinced the US is in the midst of an economic recovery, either. He called this latest 9-week rally a “gargantuan short-covering rally.”
Rosenberg, who gained fame as an economist at Merrill Lynch and is now the chief economist and strategist at Gluskin Sheff & Associates in Toronto, said he sees no revival in consumer spending in the second quarter (he isn’t sure where the buying power would come from). He acknowledges there's a large amount of cash on the sidelines, but believes it will be used to pay down debt rather than to chase equities.
more in:
http://www.minyanville.com/articles/spx-sds-fxe/index/a/22777
Ruin-Nation
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