Growth expectations fell to an all-time low in May, according to the latest Bank of America fund manager survey out on Tuesday. For a dose of perspective, the current reading is below that seen during the Great Recession and the dot.com bubble.
Such dour sentiment comes despite economists expecting the U.S. economy will have grown around 2.5% in the second quarter and unemployment levels remaining near record lows.
Amid the tepid growth outlook, large investors are moving to the sidelines on stocks the survey shows.
Consistent with the moves toward cash we are hearing about. However the fact they are staying in cash would point to them looking to capitalize on potential upward movements in the near future. So for the near term, volatility will remain, likely until the housing bubble bursts., at which point the real doldrums will begin, and you could perhaps expect a war to shift consumer perceptions and stimulate manufacturing.
