If we avoid a recession, we’re going to have a really good market.” -Jeremy Siegel, Wharton professor
After a plummeting stock market in December and for most of 2018, they could recover in 2019, per Jeremy Siegel, professor of finance at the University of Pennsylvania’s Wharton School of Business. The only condition is the U.S. needs to avoid a recession, which many economists believe is overdue and could happen this year.
In addition, investors could struggle through a tough first quarter to get to more prosperous times, Siegel told MarketWatch during a phone interview, repeating his beliefs as discussed with a prior CNBC interview.
“My feeling is that the market is virtually positioned for a mild recession, but I just don’t think that it’s going to happen,” Siegel said. “If we avoid a recession, we’re going to have a really good market,” he told CNBC.
This professor who predicted that the Dow Jones Industrial Average, would see 20,000 at the end of 2015 states that better than anticipated business and macroeconomic results should enhance bulls in the short term.
“I think we swung too positive last summer and now I think we’ve swung too negative,” he said.
That might be possible as last month’s pullback was the worst December for the Dow and S&P 500 SPX, since the 1930’s and marked the worst annual return for the three main equity benchmarks, including the Nasdaq Composite Index COMP, since the financial crisis of 2008, per Dow Jones Market Data.
However, if a recession occurs in the next year, all bets are off for Siegel, who believes the market could decrease by 5% to 10%. A recession seems unlikely because this bullish educator and market supporter believes that the strength in the U.S. economy and a healthy job market would keep economic contractions at bay.
Are we due for another recession in 2019? Please share thoughts below!
Article By: SG Staff
