Advisers give optimistic forecast for 2010

SALT LAKE CITY — "The worst is behind us" is the message an investment adviser company gave clients Friday as it unveiled its forecast for the 2010 financial markets.

Brothers Alan and Jon Tingey, principals at Tingey Advisors Inc., are predicting corporate profits will improve by more than 20 percent this year, with stronger-than-average growth for several years. And corporate profits drive the stock market, they said.

The economy grew faster than anticipated in the fourth quarter, Alan Tingey said, noting that the stock market, "true to form," predicted recovery.

"It forecasts three to six months out and sees things the rest of us might not be able to see," he said during a Friday luncheon.

The "meltdown" that has gripped the U.S. and the world since midway through 2007 was rooted in market excesses, greed, speculation and a housing bubble that burst, among other factors, he said.

Now consumers seem to have more confidence in the banking system, the government has loosened its fiscal policy to stimulate the economy and corporate profits are growing.

Another factor in market recovery, he said, is that the president's approval rating has dropped some. "The market doesn't care what party a president is in," he said, but the free-market system doesn't want to see anyone with too much power.

But he said jobs will be "weak" until the outlook for small businesses improves; true economic growth and job creation will have to fill the void left as stimulus efforts by Congress and the Federal Reserve wind down.

While governments worldwide were trying to stimulate their economies, Alan Tingey said it's worth noting that the United States was spending deficit funds but China was spending surplus.

Among indicators they considered to show when the economy improved, said Jon Tingey, were credit spreads, the housing market and vehicle sales.

Credit spreads have improved dramatically, the housing market is starting to stabilize and vehicle sales, while "sputtering," are important because that's a credit-reliant industry and any improvement shows credit is beginning to flow again, he said.

The company also announced a name change. It formerly was known as Cannon Tingey Investment Advisors.

e-mail: lois@desnews.com