Why markets will fall in 2010

Posted on

FT.com / Investments - Shares lack stimulus for further gains.

As the FT notes:

UK equities will struggle to build upon their 18 per cent gain in 2009, held back by weak economic growth, the withdrawal of stimulus measures, and the weight of government and consumer debt, analysts warn.

So that's one near certain fall for 2010, as I've predicted before.

Bonds are also in for a bashing. Quantitative easing will reduce demand. Prices will fall. Yields will rise. And another investment product will see a downturn.

If the Tories get in business will be decimated. So business property values will fall. Another sector closed.

That leaves cash. That's about the one bolt hole there is for investors. And its contribution to well being is limited.

So if the markets lead a double dip is nigh on certain.

That's the outlook for 2010.