Double-Dip Coming — 20-25% Pullback Likely: Strategist

Stocks opened lower for a fifth straight day Wednesday, following a disappointing durable-goods report. Joseph Keating, executive vice president and chief investment officer at CenterState Bank, and David Hefty, chief executive of Hefty Wealth Partners, discussed their market outlooks.

“We’re continuing to see the market trade with the theme of decelerated growth,” Hefty told CNBC.

“We have to have the economy grow and we're not seeing that happen—it’s going to lead us into a double-dip recession.”

In the worst case, Hefty expects markets to pull back 20 to 25 percent with more losses in 2011.

“What points us to that direction is that wages and disposable income across the country is coming down. Housing prices had a rally over the last 12 months or so; however, we’re seeing that tip the other way,” he said.

'Not the Way to Grow'

In the meantime, Keating said there needs to be changes in Washington’s policy in order for the economy to turn around.

“We need to send a message that big government spending, big taxes, big deficits, rule-making is not the way to grow the economy,” he said. “We have to elect people that will bring us back to a smaller-government, more incentive-driven policy.”

Opposing View:

Scorecard—What They Said:

  • Hefty's Previous Appearance on CNBC (Jun. 24, 2010)
  • Keating's Previous Appearance on CNBC (Jul. 21, 2010)
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    Market Views—Across the Board:

CNBC Slideshows:

CNBC Data Pages:


Wednesday's Top Dow Laggards (as of this writing):



General Electric*

Cisco Systems

JPMorgan Chase


No immediate information was available for Hefty or Keating.

*GE is the parent company of CNBC and