Jon Taplin posted the topic.  This blog entry is my comment in re that thread.

Sometimes talking one's book is also telling the truth and an accurate prediction, not a self-fulfilling prophecy. And it's of course reasonable to invest according to your outlook on the market.

Morgan Stanley talks its book too, yet Taplin cites wobbly opinions from MS as some kind of authority to justify his optimistic "things are actually beginning to improve". But as I read the MS extract, it's rather mixed and limited at best.

Newt is cited: "it is foolish for a president to assert that they have prime ministerial authority" and that applies to Bush/Cheney so it's not clear what the heck that quote is supposed to be about here.

Taplin also cites a mention of Soros. Soros is definitely an expert on self-fulfilling prophecies (his pet theory of reflexivity and fallibility). Yet Taplin failed to note from the same article, "[Soros'] comments echoed those made earlier at the same conference by Paul Volcker..." Volcker is advising Obama. What is their book?

It's good to question authorities when they make pronouncements. From my point of view, Soros is pretty accurate here but mired in his pet theories and lacking in a deep understanding of economics (he admits this in his recent book in which he again tries to describe and promote his pet theories). He definitely went short some markets as of August 2007, so it's a little late for him to now be trying to squeeze the last drop of blood out of the corpse.

The main problem I see besides the obvious housing bubble collapse is that trillions of $ of spending have been removed from the markets as overly and even criminally loose lending stopped. Not last fall, two to four years ago. All that borrowed private money kept an ailing economy propped up for something close to a decade (or longer in some views), to the tune of a trillion or so a year. A lot of the cash flow was funneled through home equity loans and late purchases of real property at inflated prices. The sellers and borrowers have spent or invested their cash, but cannot do so now.

A deep fundamental contraction and rebirth is necessary.