Peter Boockvar of Miller Tabak & Co Says Dow May Drop to 5,000

I'm not familiar with Peter Boockvar or his investing record but I thought it was interesting that analysts are now starting to talk about more drops in the markets. Before the talk was about whether we had hit a floor at 8,000. I personally believe we have a few more drops to go and then probably a lot of sideways growth for the next decade. It will be a long time before we see the Dow back to its all-time high of 14,164.53 set in October 2007. In a Bloomberg article, he says:

"Earnings estimates are too high and when investors realize that, they will drive the stock market lower, added Boockvar, Miller Tabak's New York-based equity strategist. Companies in the Standard & Poor's 500 Index will earn a total of $60 a share in 2009, not more than $90 as some analysts estimate, he said."

Of course what we seen is that anlaysts are constantly chasing each other up or down. When oil was shooting up last summer, analysts were tripping over each other to predict the next peak price. So it's important to take what these Street guys say with a massive grain of sale and to even be a bit contrarian. Still, in this case, I think the general thrust of his argument is correct. The credit markets remain clogged, the economy is in or will enter a recession, and sentiment appears to be getting worse not better.

I've said it before, but we're seeing a once-in-a-generation unwinding of the largest credit bubble in the history of the world. It aint going to look pretty and it aint going to be over quickly.