I believe the sub prime mess is a serious but not unsurmountable problem which will get sorted out in the next 6-12 months. There will be some volatility in that period but after that we should start to see steady gains in equities after that time. I certainly do not believe equities will trade sideways for 15 years. Part of the sub prime mess has been caused by the fact that mortgagees in the US can walk away from their property without penalty - no bankruptcy - thus very little disincentive not to walk. Try doing that in Australia! In time house prices in US will begin to recover mainly because they have a high birth rate, 1,000,000+ immigration and low interest rates. When that happens banks (in US) will recover and so will the economy. All part of the economic cycle.
