May's Big Selloff Could Be Just the Beginning
Are you ready for a lot more turmoil?</br></br>You had better be -- because there's a good chance that's what you're going to get.</br></br>Nobody knows for certain, of course. All stock-market predictions need to be taken with a little salt. But there are reasons to suspect that the sudden plunges of the past few weeks may be unhappy omens of what's to come.</br></br>Like last week, with stocks lurching wildly with the headlines -- up by triple digits one day, down the next. For the month, the Dow Jones Industrial Average dropped 7.9% and is negative for the year. The Nasdaq Composite and the Standard & Poor's 500-stock index also are in the red for the year.</br></br>Some pretty smart people are cautious. Seth Klarman at Baupost Group is worried. John Hussman of the Hussman Funds says all sorts of warning lights have lit up across his screen. Even Ron Muhlenkamp of the Muhlenkamp Fund, who usually takes a sunnier view of things, says he has moved a big chunk of his mutual fund into cash in case there's a plunge.