Four Not-So-Wild Guesses for 2004
I checked my crystal ball, read the tea leaves and cracked open my fortune cookie. And I still haven't got a clue what will happen in 2004.
But how about a few educated guesses instead? After all, life as a diehard index-fund investor can be a little dull, so I have to find some way to keep myself amused.
To that end, here are my four not-so-fearless predictions for 2004.
1. Making Less
Much was unusual about the bear market that ended on October 9, 2002. Not only did the stock market suffer three consecutive losing years, but shares remained richly valued, even at the market low.
Nonetheless, the subsequent rebound has, thus far, fit right into the historical pattern.
In the first 12 months of the current market rally, the Standard & Poor's 500-stock index soared almost 34%.
That sort of explosive market rebound is typical, says Eric Bjorgen, a senior research analyst at the Leuthold Group in Minneapolis. Mr. Bjorgen analyzed how stocks performed after the last 21 bear markets.
His finding: In the first 12 months of these 21 market recoveries, stocks climbed 47%, on average. I suspect the current rally's more muted gain reflects today's richer valuations.
But what about the second year of the recovery? In three of the 21 market recoveries studied by Mr. Bjorgen, stocks lost money during this second year. But on average, shares rose 10%. With that in mind, I wouldn't be surprised to see stocks post modest gains in 2004.
Indeed, there's a chance the Dow Jones Industrial Average could break 11722.98 this year, thus surpassing its early 2000 bull-market peak.
We will have to wait a little longer, however, for the Nasdaq Composite Index to return to its all-time high of 5048.62. My best guess: At 7% a year, we should get there in 14 years.
2. Doubling Nothing
Money-market fund yields, now averaging 0.5%, could double or triple in 2004. But don't get too excited. Even at a 1.5% yield, money-fund holders will likely be underwater, once they factor in taxes and inflation.
What to do? If you have a big chunk of cash sitting in a money-market fund, a savings account or some other super-safe investment, I would hunt for higher-yielding alternatives.
In particular, consider Series EE savings bonds, a low-cost short-term bond fund or a stable-value fund, if that's one of the options in your employer's 401(k) plan. Also consider making extra principal payments on your mortgage. Over the next 12 months, all of these strategies should generate a higher return than a money-market fund.
3. Blowing Bubbles
This year, I doubt we will see a market implosion that rivals the S&P 500's 49% decline during the recent bear market. The fact is, that sort of disastrous market collapse is hardly a common occurrence.
But others clearly beg to disagree. Still smarting from the brutal bear market, many folks are scanning the horizon, anxious to spot the next bubble. There's talk of a crash in bond prices, technology shares and the dollar's value in the foreign-exchange market.
Among bubble watchers, however, the biggest fear is a collapse in property prices. I wouldn't be surprised to see home prices stagnate or slip over the next 12 months. But a huge plunge in prices seems unlikely.
"My wish for 2004 is that we don't see the word 'bubble' appear in print anywhere," quips Chris Mayer, a finance professor at New York's Columbia Business School.
He notes that falling house prices are typically preceded by a slowdown in home sales. "We've seen some evidence of transactions drying up," he says. "But it hasn't been big and it hasn't been widespread."
Prof. Mayer reckons that, if interest rates stay flat and the economic recovery continues, home prices could climb modestly in 2004. But even in that rosy scenario, he figures 2004's price gains probably won't match the heady increases of the past few years.
4. Changing Little
In the wake of the market-timing scandal, there has been much talk of reforming the mutual-fund business. There's certainly plenty of room for improvement, especially when it comes to excessive fees, reckless performance advertising and misleading sales of broker-sold funds.
To settle legal complaints, it seems scandal-tainted fund firms will be compelled to cut fees temporarily. It also appears we will get modest changes dealing not only with the problem of market timing but also with "directed brokerage" and "soft dollars," where a fund company uses its trading commissions to reward brokerage firms that sell its funds or provide research and other services.
But will we get permanent, far-reaching reform? Jon Fossel, the retired chief executive of New York's OppenheimerFunds, is optimistic. Working with Don Powell, another retired fund executive, Mr. Fossel has drawn up a wish list of 11 key changes.
Among other things, they would like to see mutual-fund boards of directors headed by independent chairmen, and a revamping of mutual-fund expense ratios so they include trading costs. They also want a ban on dunning existing fund shareholders for money that is then used either to market a fund or to reimburse brokers who "service" shareholder accounts.
"I think the odds of change are pretty darn good," Mr. Fossel says. "There are two reasons. One, change is overdue. The industry is far larger than it was two decades ago. There have been significant economies of scale, and those should be passed along to shareholders. Two, you have the impetus from the scandal."
I wish I could share Mr. Fossel's optimism. But unfortunately, after the initial howls of outrage, it appears the pressure for reform is already starting to fade. My hunch: A year from now, the market-timing scandal will be a distant memory, and any changes will be all too modest.
对2004年市场的四大预测
我查看了水晶球、茶叶和幸运饼，可对2004年的市场走势依然毫无头绪。
那么，让我做一些有根据的猜测如何？毕竟，像一个买卖指数基金的投资者那样生活实在有些乏味，因此我得到找到让自己快乐起来的方法。
以下就是我对2004年所做的4个大胆的预言。
1. 股市增幅趋缓
于2002年10月9日结束的熊市有些不寻常。不寻常之处不仅体现在美国股市那时已连续3年下跌，还表现在即使当市场处于低谷时，股票的估价依然很高。
尽管如此，市场随后的回升到目前为止仍然与以往的发展模式十分吻合。
在此次牛市的前12个月里，标准普尔500指数(Standard & Poor's 500 stock index)猛升了近34%。
明尼阿波利斯(Minneapolis)的Leuthold Group的高级分析师埃里克?比约吉(Eric Bjorgen)指出，股市的这种大幅度反弹是很典型的。他对市场在过去21个熊市结束之后的表现做了分析。
结果发现：在股市随后复苏的前12个月里，市场的平均升幅为47%。我认为股市目前较为温和的涨幅反映出如今的股票估价较高。
那么，在市场复苏后的第二年，情况会怎样？根据比约吉的研究，股市在这一年会遭受损失。但平均来说，股票会上涨10%。因此，如果市场在今年会出现温和上扬，我也不会感到吃惊。
事实上，道琼斯工业股票平均价格指数(Dow Jones Industrial Average)在今年可能会突破11722.98点，超过它在2000年年初时创下的最高点。
不过，要纳斯达克综合指数(Nasdaq Composite Index)重回历史最高点5048.62点恐怕还需时日。我对该指数最乐观的预测是每年增长7%，以此推算需要14年时间才能重上最高点。
2. 投资回报提高
当前，货币市场基金的平均收益率为0.5%，不过这一指标在今年可能会增长两倍或三倍。可别太兴奋了。即使收益率达到1.5%，考虑到纳税和通货膨胀，投资者们仍有可能入不敷出。
那怎么办？如果我对货币市场基金、储蓄存款帐户或其他特别安全的投资品种有大量投资，我会选择其他收益较高的投资种类。
例如，你可以选择Series EF储蓄债券、低成本的短期债券基金或稳定的价值型基金，如果你的401(K)计划可以选择这些投资品种的话。你还可以多还一些抵押贷款的本金。在今后12个月里，所有这些策略会都会带来更高的投资回报。
3. 泡沫不会出现
今年，我认为股市不会出现像标准普尔500指数在上次熊市里下跌了49%那样的暴跌。实际上，这种崩盘现象是很少见的。
有些人显然持不同观点。许多投资者对惨痛的熊市依然记忆尤新，因此小心谨慎，希望发现下次泡沫的影子。已有传闻说债券、科技股和外汇市场上的美元价格将出现崩溃。
对于这些观望泡沫的投资者来说，最令人担心的是房地产的价格猛跌。如果住宅的价格在今后12个月里停滞不前或往下滑，我并不会感到奇怪，但房价似乎不太可能大幅下跌。
"对于2004年，我希望我们不会看到泡沫一词出现在任何媒体上，"克里斯?梅耶(Chris Mayer)说。他是纽约市的哥伦比亚商学院(Columbia Business School)的金融学教授。
梅耶指出，在房屋销量趋缓前，房价通常会回落。他说："已有迹象表明交易量减少，但幅度不大，而且并没有蔓延开来。"
梅耶教授认为，如果利率保持不变，同时经济持续复苏，房价在今年也许会适度上涨。不过，即便如此，他预计今年的房价也不会像过去年那样迅猛增长。 4. 市场改革力度不大
在择时交易丑闻曝光之后，不少人提出要改革共同基金业。这一领域当然有许多值得改进的地方，尤其是共同基金的收费昂贵，还胡乱吹捧未来的业绩预期，此外经纪人在销售基金时还随意误导投资者。
为了解决法律争端，看来那些丑闻缠身的共同基金公司将被迫暂时下调费率。此外，择时交易以及"指令经纪"和"软钱"问题看来也将得到重视。"软钱"是指基金公司把部份交易佣金给券商，作为销售该基金或提供研究等服务的酬劳。
可是，改革会是长期性的、影响深远的吗？曾在纽约的OppenheimerFunds担任首席执行长的乔恩?福塞(Jon Fossel)对此表示乐观。他与另一位离任的基金经理邓恩?鲍威尔(Don Powell)拟定了一份含有11项重大改革措施的清单。
他们希望共同基金公司的董事会由独立的董事长来领导，并修改基金的费率，把交易成本考虑在内。两人还希望推出一个禁令：不准向现有基金的投资者讨钱，然后用这些钱推销基金，或是给经纪人提供酬劳。
福塞表示，"我认为进行改革的可能性很大，原因有两个。首先，改革早就该进行。基金业现有的规模远远超过了二十年前。经济规模的效益很显著，而投资者理应从中受益。其次，丑闻提供了改革的动力。"
我真希望自己能像福塞那么乐观。但遗憾的是，经历了最初的义愤填膺后，要求改革的动力似乎在逐步消退。我的直觉是：一年后，择时交易丑闻将成为遥远的记忆，任何改变都将是温和的。
