Burton Malkiel in Monday's WSJ ("Irrational Complacency") takes investors on a tour of the upsides and the downsides of today's economic outlook. He applies common sense economic thinking and his assessments are all plausible. He concludes by tipping towards the optimistic.
But Malkiel also notes that his advice is helpful up to a point because "... new highs in the market should induce investors to to review their asset allocations. If the rising stock market has pushed your allocations of equities well above the level consistent with your risk tolerances, it make sense to consider rebalancing."
In The Black Swan, Nassim Nicholas Taleb warns us that we are likely to make a hash of it because we treat uncertainty by invoking distributions that are too simple and with tails much too thin. Taleb's latest book (reviewed in Sunday's NY Times) goes over much the same ground as his earlier Fooled by Randomness and I liked the first one much more.
But reading either, one has to wonder how we survive and prosper. We have either evolved better hedging plans and devices than the author would accept or we are simply not that good and just on a roll.