Tags: tice | stocks | bear | market

Tice Sees Stocks Plunging 54 Percent

By    |   Friday, 01 May 2009 10:15 AM

The bear market in stocks is just hibernating now and will soon come back with a vicious growl, says David Tice, chief portfolio strategist for bear markets at Federated Investors.

Tice, who called the market’s top in 2007, isn’t swayed by the recent 31 percent jump in the Standard & Poor’s 500 Index from its March 6 low

“Denial isn’t just a river in Egypt,” he tells Bloomberg TV. “A lot of people on Wall Street are experiencing denial.”

This is a bear market rally, Tice says.

“There will be a lot of rallies. However, we expect a lot of declines, with each decline taking out the previous low.”

The S&P 500 could drop to 400, he says. That would constitute a 54 percent plunge from Thursday’s close.

“A lot depends on policy responses between here and there,” Tice says. “We haven’t had capitulation.”

He says, “Individuals out there simply haven’t sold. That to me indicates how far we have to go.”

And why should stocks fall?

“The excesses and imbalances we created over this last 25 years were so vast, that we’re going to have to pay the price,” Tice says.

“This isn’t just a garden-variety inventory recession. We’re calling it a depression.”

Tice isn’t the only bear. Some say the government’s intrusion into the economy will hurt stocks.

"We've got some fairly heavy-handed government intervention here, and the market is concerned about that," Stephen Massocca, managing director at Wedbush Morgan, tells Reuters.

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The bear market in stocks is just hibernating now and will soon come back with a vicious growl, says David Tice, chief portfolio strategist for bear markets at Federated Investors.Tice, who called the market’s top in 2007, isn’t swayed by the recent 31 percent jump in the...
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Friday, 01 May 2009 10:15 AM
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