Vanguard Warns Market to Fall
One of the world's largest fund providers just went on the record warning investors about the stock market. Vanguard says it is surprised by how well the economy has been performing this year, but that such performance does not make it more hopeful for stocks. The fund provider says investors should expect "muted returns" for the next decade. According to Nathan Zahm, a senior investment strategist at Vanguard "what we caution investors on, particularly given that landscape and given the very strong run we've had, is that forward-looking returns are now quite muted." Valuations are a big part of the company's worries about returns, said Zahm.
FINSUM : This is about as close as you will ever get to a major fund manager saying stocks are ready for a fall. Vanguard obviously has a lot of insight into the market, but we don't necessarily agree that returns will be poor for a decade. That just seems way too long for any kind of accurate forecasting.