Equity prices rallied strongly last year and have held their ground this year, reversing a good portion of the losses sustained over the previous three years. In addition, home prices appreciated sharply during each year from 1997 through 2003.
Market analysts’ surveys indicate expectations of a slightly delayed lift-off. I don’t want to directly answer this question. But we try to judge if market expectations reflect fundamentals and if market expectations fit with our views. It’s a two way street: we learn from markets and markets learn from us.