This interesting article (link below) discusses the fact that so many market pundits who have been repeatedly calling for a massive stock market correction have, at least so far, been consistently wrong. In fact, some have been wrong for years. Marc Faber and Noriel Roubini come to mind on this latter point.
What’s the point? Forecasting the stock market is pretty much a futile if not impossible exercise. There is no one we are aware of who has been able to forecast the market on a consistent basis. The stock market is driven primarily by the direction and strength of corporate earnings. The rise in the stock market over the past five years primarily reflects the rise in corporate profits and the low interest rate, low inflation environment. The key point for wealth management is not so much trying to predict the direction of the market, but rather 1) having a properly diversified portfolio which helps to mitigate market volatility, 2)having a sound fundamental basis for one’s investments and investment strategy, 3) sticking with a disciplined plan that obviates the need or temptation to time the market. Over the long term, a properly diversified portfolio should deliver superior risk-adjusted return, which is a paramount objective in wealth management.
Link: http://money.msn.com/investing/why-all-the-correction-calls-have-been-wrong