Chances of Positive S&P Returns Given Negative GDP

I got a bit concerned that I'm predicting that stocks will go up even though I expect the GDP to remain negative for at least 12 months. Since 1947 there were 19 quarters where the GDP was negative and S&P returns have been positive out of 38 negative quarters. So it's a bit of a toss-up.

My view that stocks should move higher in the short term, is based on the assumption that stocks have been pushed too low due to concerns over the banking system. I think that the Treasury department will find a way to resolve the banking issue, and stocks will move up. However, we should not ignore the fact that the bear market is unlikely to end until we see a substantial improvement in the GDP.

There has been an improvement in the CDS market as well but we are not out of the woods yet.