Harry Lange, a manager of Fidelity Investment’s popular $40.5 billion Magellan fund, believes that once the effects of the central bank’s rate cuts and the government’s economic stimulus packages kick in, U.S. stocks could be near an “important bottom.”

On Thursday, Lange expressed his views on Fidelity’s website saying, "One rule of thumb I've found useful is that actual risk in the stock market is typically inversely proportional to perceived risk. Judging by that maxim, I think we could be close to an important bottom in stock prices.”

Lange is banking on the fact that the Fed’s rate cuts and federal government’s $100-billion tax rebates will have their desired impact on the economy, although he pointed out that “it might take some time for these measures to kick in.”

When it comes to crude oil, though, Lange is not quite as optimistic. Instead, he points to an increase in demand from China and India in combination with a decline in production as indicators that long term oil prices will only continue to rise.

“Over 1,000 cars a day are being registered [in Beijing, China], all of which will add to the demand for gasoline,” Lange said. “Those drivers have not experienced gas prices at significantly lower levels, as many of us have in the United States, so I think they’ll be less likely to rein in their spending even if gasoline prices move higher.”

Since mid-March, the S&P 500 index is up 10.1%, yet it continues to struggle overall, falling 4.4% since the start of 2008. The bottom line for Lange is that even if the stock market begins to recover over the course of the year, crude oil prices are bound to go up, much to the dismay of many Americans.

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