Doug Kass (@dougkass) of Seabreeze Partners thinks the economic recovery and market rally will be short lived. A big portion of it is "recession fatigue", he said. He's also going against consensus estimates. Here are the headwinds he sees affecting the economy. Video after the jump.
Secular headwinds: Fiscal imbalances, inevitability of higher marginal tax rates, excess housing inventory, gridlock/reluctance to address the deficit, structural increase in unemployment.
Cyclical headwinds: Rising interest rates, inflation, rising commodities like oil (and agricultural commodities), corporate profit margins are at a 57 year high and are vulnerable to mean regression, sees less top line growth, and I think he said "some reversal in wage deflation".
Related: Doug Kass: Shortage of 'This' Could Roil 2011 Markets and his Gold and S&P forecast.