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Hope Springs Eternal

Reported by Judy - December 31, 2005

After a year of claiming that the stock market was soaring under George Bush, did Fox News Channel's "Bulls and Bears" close the year on Saturday (Dec. 31, 2005) by looking at what really happened? Or did they merely move on to more optimistic hyperbole about 2006? If you were a blind Bush lover, what would you do?

You probably would skip the analysis of what really happened in 2005 and how that differed from what you predicted week in and week out, and barge ahead with more foolish predictions about 2006. Which is what most of the bulls and bears did.

Never mind the fact that the Dow ended the year essentially flat (down 66 points) after the Bulls and Bears told us week in and week out that George Bush was giving us a great economy. Host Brenda Buttner barely mentioned the Dow's lackluster performance, alongside the news that that the Nasdaq and Standard and Poors 500 ended the year each up about 3 percent. She asked for no analysis of what happened, about why the Dow didn't break 11,000 as some of the Fox panel predicted a few weeks ago. Who cares why it happened? The panel isn't there to explain. It's there to lead cheers for Bush and capitalism. Things are great, go, fight, win!

Gary B. Smith, from realmoney.com, was the biggest bull, predicting the stock market would go up 25 percent next year, after a market sell-off in January that takes it down 3 to 5 percent. Scott Bleier, of hybridinvestors.com, predicted the Dow would hit nearly 12,000 next year, after breaking 11,000 in January. Charles Payne, CEO of Wall Street Strategies, predicted a 15 percent market growth next year. Tobin Smith, of Changewave Research, went with 12 percent market growth from the bottom in January.

As usual, Pat Dorsey of morningstar.com, kept his head while all about him were losing theirs. "The economy slowing down is more likely than not to happen next year, but that's not the end of the world. Two to three percent growth is still pretty robust for an economy this size. What that means is we're just not going to get explosive 25 percent growth in the market. ... Flat, up a little, down a little, this year, next year. It's about the same." Consumer spending probably will slow some, he said, because housing prices will not climb as rapidly and people will be less able to take money out of their home equity to spend.

So whom to believe? Well, none of the bulls explained what was going to change to cause this sudden turn around. The closest thing to analysis was from Gary B. Smith, who said pundits tend to extrapolate from what has been happening when they make predictions. "That's why I think the big up year, which is definitely going to happen, is going to surprise a lot of people," he said.

One thing that surprised these Bush lackeys last year was the price of oil. Scott Bleier of hybridinvestors.com, told us last January that oil prices were going down, to $40 a barrel. It turned out to be the worst prediction of the year by this bunch. His analysis? "Listen, the oil situation continues to keep prices high. Demand remains strong and it was just a miserable call but oil will be back to $40 when the economy slows. Probably the end of this year (2006)."
Gee, I thought the economy was growing next year, with the market up 25 percent, or at least hitting 12,000? So how will oil prices fall if the economy is growing?

Don't expect it to make sense. This show is all about predicting the best of all possible worlds, despite reality.

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