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Jeff Saut, chief economist at Raymond James, weighs in on the new debate over the debt ceiling and how it affects investing.
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-- Is -- -- make about it managing director Raymond James & Associates I want his take right here right now.
Now this business ceiling increase depth -- of course built -- -- the agreement that was.
Cooked up earlier in the year but the fact is super committee did baucus we lost our triple -- credit rating.
Jack all is getting done down in DC as an investor I get mad -- are you gonna do something about it.
I just think it points to that this functionality.
What's going on inside the DC beltway -- I used to live.
He will probably get to the raise of the debt ceiling because I believe the house doesn't come back.
Until January 17 in the senate comes back on January 23.
So they'll more than likely get it but -- it it's it's pretty dysfunctional inside the beltway right now.
Would there since to be an incredible disconnect between that dysfunction in Washington what is not happening.
Among our lawmakers and down in DC and what investors are willing to do with their money.
So it clearly there's no action to get our debts under control to reduce spending in Washington but people are still willing to land.
The federal government money at 2% a year over ten years.
And I wonder what gives first in your mind and does any of this matter -- -- does it ridiculous and -- -- and I'm thinking about the stuff at 10 o'clock at night.
Well I I think there's a change of foot inside the beltway I think that.
The Tea Party and I'm not a Tea Party person but I think they surface what Adam Smith wrote about in 1776.
In the book the wealth of nations.
Where he talked about the political corruption that prevents prosperity.
And I think if you go talk to the -- -- were elected in the mid term cycle.
You'll find a lot of them came out of business and they've actually had to make payrolls and there there really don't want to be inside beltway.
But they feel it's a patriotic do because they think that that country is headed note the wrong direction so.
I think there's a change of foot -- on the hill and I think it's gonna manifest itself in the and upcoming election in 2012.
Looking at some of the sectors going into the new year you have I'm gonna talk about financials later in the show financials incredibly hard hit worst performing.
In now and then next to that basic materials and that hasn't he what do you like next year energy was essentially flat but you have oil at a hundred.
Over a hundred dollars a barrel -- does that make that industry attractive.
Yeah we still like crude.
Oil per capita incomes continue to rise around the world and when they do people consume more.
Gasoline and and and crude oil and we think one of the themes going forward in 2012.
Is -- MLPs a master limited partnerships that traded eight to nine times ebitda.
Are gonna acquire -- the PC.
Corporations that trade between four and five times ebitda.
And it's going to be creating.
So we think that's a pretty decent theme in the new year.
I love that you just worked and even and and master limited partnerships and -- corporations all in one sentenced to up and actually made an investment idea have products that thank you return I don't know but it.
-- -- take you there is great to see you happy new year -- policy before them.
Morgan Stanley --
