Bottoming Out? A Bearish Strategist Says It Isn't Happening Yet
NEW YORK -- With people back from summer recess, the question on nearly every investor's mind is the one posed by stock market strategist Abby Joseph Cohen: "How low can it go?"</br></br>Her answer is of more than passing interest. Ms. Cohen, the strategist at Barclays de Zoete Wedd, was bearish well before Saddam Hussein sent stocks into a tailspin.</br></br>She was cold to the market while it rallied last year. She was bearish after the Dow Jones Industrial Average soared late this spring. And she is bearish now -- perhaps bearish enough to make investors wish their vacations could last a little longer.</br></br>To quote from Ms. Cohen's most recent report: "The sharp decline in equity prices has not significantly improved the valuation of equities, since much of the decline has been offset by the rise in interest rates."</br></br>Moreover, she says, judging by the level of long-term rates now and Wall Street's consensus projection for corporate earnings, "U.S. equities are still some 15% above a theoretical buy price."