16% Loss Forecast For 2014 U.S. Stock Market [SPDR S&P 500 ETF Trust, ProShares Short S&P500 (ETF), ProShares Ultra S&P500 (ETF), ProShares Short QQQ (ETF), iShares S&P 500 Index (ETF), Vanguard 500 Index Fund, ProShares UltraShort QQQ (ETF)] - Seeking Alpha

16% Loss Forecast For 2014 U.S. Stock Market [SPDR S&P 500 ETF Trust, ProShares Short S&P500 (ETF), ProShares Ultra S&P500 (ETF), ProShares Short QQQ (ETF), iShares S&P 500 Index (ETF), Vanguard 500 Index Fund, ProShares UltraShort QQQ (ETF)] - Seeking Alpha

This is an outstanding article predicting the stock market's future with a great mathematical formula.  The author uses the formula to make calculations about 2014 and beyond, and he places the math results in two great tables.  If we take the 6% reasonable earnings growth for 2014, this gives us a negative stock market prediction if a PE of 15 is accepted again as normal, and we have a possible 11% positive return if the market allows a PE of 20.  The bottom line is there is almost no way we can have another 25% up year.  The big investors will not allow another year 2000 balloon on high PEs.

So, the market PE will most likely not go over 20 in the near or distant future.  This means we are looking at 9 to 11% returns at best over the next several years.  We need to plan accordingly to play it safe, and we should be mostly invested in dividend stocks for a more certain return.  I recommend PSEC and PHT for good dividend stocks that pay on a monthly basis.  PSEC  pays over 11% annually and PHT distributes more than 9%, and these stocks will be a lot more stable than the general stock market.