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February 11, 2008

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Greg Feirman

Kent,

I addressed this same topic on Friday. I think stocks are priced for a "mild" recession:

http://www.topgunfp.com/stocks-now-priced-for-mild-recession/

Kirk

The problem with looking at a previous recession, in this case 1990, and claiming history rhymes is you may be looking at the wrong period. What if we are in a 73 and 74 period. Rates below inflation, high oil, nasty international and costly war.

Or, could you make an argument for 1933? A few years past a stock market bubble, deflation in housing, enormous debt by the government, corporations and individuals.

The Financial Philosopher

Kirk:

You are absolutely correct, especially if you are saying that investment decisions should not be made based on history alone...

To answer the question my post is asking, "Is Recession Priced Into Stocks?:" The answer, based on the "rhyme" of history, would be "probably." Should we invest our assets expecting a "repeat" of 1990 or any other period? Absolutely not...

Thanks for your thoughts...

Hamed Elbarki

Great information... if only we had that crystal ball!

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