A 1996 study by the Federal Reserve Bank of New York found that economists working for Wall Street firms, for instance, tended to make more offbeat forecasts than their counterparts at other kinds of companies. Whether intentional or not, an overly bullish or bearish call is a way for a strategist to get his firm noticed. Look at Michael Metz of Oppenheimer. An investor following his consistently pessimistic analysis in recent years would have likely sat out the last 5000 points of the Dow's advance. By playing the role of designated bear to the media, though, his pessimism has garnered him and his firm plenty of media attention.
Strategists also work for entities that profit when people feel cheery about the market.
The more people invest, the more companies merge, the more firms that go public, the better. The pros maintain that they call them as they see them, but back in 1991, strategist Suresh Bhirud claimed he was fired from Dean Witter Reynolds for being too bearish. Cohen recalls that back in 1990, she was considered one of the biggest bears on the Street. Despite their shortcomings, there's no doubt that even pros pay attention to Wall Street's gurus. If they were to switch directions in a meaningful way, I would have to really think.