Doug Cliggot on the Market, Then and Now

Tuesday, February 03, 2004 | 05:27 PM


Finally watched the TiVo'd Louis Rukeyser's Wall Street from a few weeks ago with former J.P. Morgan Equity Strategist Doug Cliggot (now with Brummer & Partners).

Cliggott made a name for himself in early 2000, when he correctly predicted that the year would be the roughest one for stocks since 1994. The S&P 500 index and Nasdaq Composite proceeded to close within a hair's breadth of his year-end price targets of 1300 and 2500, respectively. (Of course, he also called for a correction in 1999; No one's perfect).

Harvey Eisen asked Cliggot a terrific question, and got a great answer. Its worth reproducing here (its transcribed as best as I could):

Eisen: You had one of the great all time calls at the top of the Market in 2000. What would cause you to be Bullish on stocks?

Cliggot: What has made stocks be a wonderful asset class for the last 20, 25 years was the starting point.

We started with a very low P/E multiple;
Now we have a very high P/E multiples.

We started with a very high interest rates;
Now we have a very low interest rates.

We started with a very high inflation rates;
Now we have a very low inflation rates.

We started with a very high tax rates;
Now we have a very low tax rates.

When I look out at the next 2-3 years, all those key metrics are going to go in the wrong direction . . .

Very interesting stuff . . .

via CNBC


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