Clients of Raymond James Financial Inc. who are stuck holding $1 billion of auction rate securities will have to hang onto the paper for months to come, even though several large firms have announced buybacks.
The nomination of Financial Industry Regulatory Authority Inc. chief Mary Schapiro to head the Securities and Exchange Commission has intensified worries about whether Finra will take over the regulation of financial advisers.
"Most of the bad economic news that can possibly happen has already happened."
"There is tons of money sitting on the sidelines and companies have tons of money sitting on their books."
"I think it will be a little bit bumpy for the economy and the markets for the first few months of the year, but then we will gain some traction," Mr. Glovsky said. He thinks the second half of 2009 will be strong.
Mr. Dinallo will focus on securities lending this year, asking each life insurance company about its approach toward these transactions and preparing to evaluate the carriers' programs.
In 2009, look for an increase in individual lawsuits, rather than class actions, filed by institutional investors such as pension funds and insurance companies in litigation stemming from the subprime debacle.
The stock market hasn't hit bottom yet, but by the end of 2009 it will have turned positive.
Despite the market turmoil, which caused a decrease in assets under management in 2008, financial advisers and the independent broker-dealers who serve them will see business boom in 2009.
"It will be a difficult year. We expect commercial-property investment volume to increase 15% from the depressed levels of 2008 as more distressed assets come to market," Mr. Bach said.
In the third or fourth quarter, he thinks think money will come back to the industry with a vengeance. Pension funds are going to realize that their asset allocations are out of whack, Mr. Lo said.
The economy will continue to be under pressure from rising unemployment and declining industrial output through the first half of 2009. Unemployment will reach 8.5% to 9% by yearend.
The fixed-income market — particularly the distressed corporate-bond area — offers the strongest opportunities in the year ahead, he said.
Ms. Lassus, whose organization represents fee-only advisors, predicted that the economy will begin to rebound between the latter half of the summer of 2009 and into 2010.
Market predictions have little value for Mr. Lamb, but he is willing to hazard a guess that later this year, "we may see a glimmer of hope that the world is not going to zero." At that point, a vigorous rally could ignite, he said.
Despite the stress experienced by the financial services industry, now is not necessarily the time to abandon capital-intensive technology investments, Mr. Kumar said.
The effects of government action domestically and globally will be felt in a positive manner, with the recession ending in the second or third quarter, Mr. Klosterman said.
Mr. Kleintop predicts that the U.S. economy will emerge from the recession in the second half of 2009. He also expects the economy to experience a deflationary period earlier in the year, leading to the return of inflation toward its end.
Mr. Slott is convinced that taxes will go up in 2009 and believes that advisers should work with eligible clients to help convert individual retirement accounts to Roth IRAs.
"A big transition will be [occurring] in the international marketplace," said Mr. Schreiner, who manages money using probability-based measures and technical tools, and also uses outside managers who employ quantitative strategies.
