Twas the Week Before the Cliff:
Twas the week before the Fiscal Cliff and all through the Congress and White House, not a bill was to be signed not even with the help of Santa Klaus.
The traders stood ready to buy on the Big Board as they waited for Boehner and Obama to reach an accord.
Now BOEHNER! now REID! now PELOSI and CANTOR! On GEITHNER! on KERRY! on BIDEN AND BAMA!
Get a deal done! Get on the phone and make that call! Don't raise our taxes, instead let them fall!
Who's it going to be, who will be the first to blink? It's all a game of Budget Bluff, that's what I think.
They will assert that it wasn't for their lack of trying, They all wanted a deal but they couldn't stop fighting.
In the end they will come together after the stock market has fallen, They will claim that they both won while we the people lose out due to their stallin(g).
OK, so maybe I'm not a poet, but not bad for 20 minutes of work. SEASON'S GREETINGS and HAPPY HOLIDAYS to all! Since it is Christmas Eve (day), as you might guess I will keep it brief today. I've got a lot of fish to prepare for tonight's "Festa dei Sette Pesci" or our Italian feast of the 7 fishes. The market will also close early at 1pm so make your trades in the morning if you need to do anything.
I thought I'd keep it simple this week and present you with my annual financial market Christmas wish list. We did pretty well with last year's list so let's see how we do this year. So here goes, my 11 Christmas Wishes:
- For goodness sakes, arrive at a compromise on the Monetary Crag (Cliff) and avoid the pain that would ensue without one. I'd like to ask for it to be done before the end of 2012 but I think that is asking a lot.
- For 2013, all S&P sectors produce a gain leading to another 10%-plus gain in the S&P 500 and other major averages.
- Crude Oil stays below $90 a barrel.
- A drop in unemployment to 7% by the end of 2013.
- Four quarters of positive and accelerating GDP Growth with overall growth average > 2.5%
- Europe ends its recession and produces positive GDP growth.
- Spanish and Italian bond yields stabilize and both those countries begin getting their fiscal houses in order.
- As part of the budget compromise, capital gains rates stay below 25% and dividends retain the qualified and non-qualified distinction. Also, no limitation on Muni Bond interest.
- Continued strength in US Housing leading to the aforementioned employment gains.
- China economy is not a house of cards and the country returns to growth mode.
- Bond yields stay relatively stable and investors don't rush out of the market as employment gets better. The 10-year UST stays below 2%.
So there you have my wish list. I can probably come up with another 20 items but I don't want Santa to think I am greedy. That’s all for now, have a great week and MERRY CHRISTMAS!
Bob Centrella, CFA, President/Managing Partner, Forza Investment Advisory LLC, a Registered Investment Advisor.
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Bob Centrella, CFA, is President/Managing Partner of Forza Investment Advisory, LLC, a Registered Investment Advisor based in Westfield, NJ. More information on Bob and Forza Investment Advisory can be obtained from www.ForzaInvestment.com. You can call at 908-344-9790 DISCLAIMER: The material represents the views of Bob Centrella, CFA and the information is believed to come from reliable sources. Although we have reviewed the material we can’t guarantee the accuracy and completeness of all the information. Do not rely on this information alone to make investment decisions. The information contained in this blog is not intended to constitute financial advice, and is not a recommendation or solicitation to buy, sell or hold any security. This blog is strictly informational and educational and is not to be construed as anykind of financial advice, investment advice or legal advice. We urge you to talk to a financial professional before making investment decisions for a discussion of risks involved