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A majority of investors believe the end of QE2 means treasury yields will rise, according to a poll from Bloomberg. A smaller 43% of investors believe the S&P 500 will drop as quantitative easing ends.But while 54% of respondents do believe treasury yields will rise in the post QE2 market, 26% said the yield on the 10-year will stay the same, while another 17% said it would fall.
It shows the market has some doubt about Bill Gross’ thesis, that bond yields will rise as QE2 ends, with many supporting Jeff Gundlach’s view, that yields will actually fall.
Further, there isn’t overwhelming consensus about stocks either. While 43% see stocks falling, another 17% see stocks rising, and 37% see no change.
Even the dollar has investors confused. 43% see it rising, with 26% believing it will fall, and another 26% believing it will stay the same.
Unlike investor’s belief that the U.S. will need to raise taxes to tackle the deficit, their doesn’t seem to be much certainty around the market’s moves post QE2.