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So stocks are bouncing back today at 94 points from the worst week of the year what brought investors over the wall of worry is -- more upside ahead let's bring in Mike Thompson managing director S&P capital IQ.
Thanks so much for joining us you know as as we bring people want and we talked -- you talk to retail investors it seems like the wall of worry has never been higher.
Is that an opportunity.
For investors -- to think it's justified.
No I think -- true historically.
When you have lots of uncertainty equities tend to benefit and that people I think the most comfortable very straightforward.
There's lot to worry about right we have a lot of economist -- issues.
I think you know obviously the sovereign.
Situation is the constant storm that keeps coming back and then you have.
You know always a fear resides in a shock so you know actually could be good for.
But here's the thing in this is what strikes me I know we're coming up the -- -- could be here for the market -- up about a hundred points right now.
We know the G -- going on we note that they're going against austerity -- growth spend spend spend prince.
The problems away we know there's talk of another round of quantitative easing here in the US are -- -- is addicted to the stimulus money.
Well you know the funny thing about markets as markets respond policy and it's really interesting because.
But I think you gonna possibly see and a lot of ways I think the market has kind of accept the fact that a lot of stimulus isn't necessarily helpful.
Okay clearly I mean.
Yeah for the stock market the wealth effect has been in full effect if -- well.
Well actually I think the stock market might very well be beneficiary of the fact that they basically destroyed the risk profiles of market driven treasury market.
-- -- -- You have a market in the treasuries as completely constricted.
By what's gone on by policy makers on both sides would argue somewhat fiscally and also on the monetary side.
You say that you -- slow growth is here to stay that we're looking at maybe two and a half percent in the US for the foreseeable future.
-- so how do you invest in that environment well one thing you talk about is focusing on stocks with a high percentage of revenues coming from the US.
That's the opposite of what everybody was saying last year they were saying get the big multinationals who can at least make money outside -- you last.
-- are you focusing on things of the trying to make money in the US growth this a -- Well you know as bad as things are in the US things can be actually a lot worse elsewhere.
There's been a lot of real opportunity for the US in particular that.
If you look at the dynamics for example let's just -- look at the EU.
The EU basically.
Has a real problem.
They're probably you know potentially could even lose some members.
The Euro actually could actually start really losing ground against the dollar in interest rates could back up now what's really interesting is.
But what about developing nations Mena we don't have a lot of time but I mean that was true of the U last year as well in the US and people -- you've really got to go -- get in on emerging markets that's way to get it done go to China.
Go to India that what you don't agree without.
Well to a certain degree but I mean I think you can get that by investing in you know companies in the S&P 500 you get enough exposure there without going directly if people don't take for granted the really advanced state of our capital markets disclosure the regulatory framework that is abided by by and large very rigorously.
And I think that comes near the -- attacks and I think that's large part of why US equities are so popular to investors globally.
What about -- run time.
Arts and memorabilia babe -- Jersey right just sold for a record -- Anything that stop by -- -- -- that hard assets gun sales Smith & Wesson is reporting its hot corner.
I mean it's only if it's kind of an interesting if you take this perspective you know -- go with it like.
There's perhaps panic -- as out assets and investments.
Yeah I mean I guess that's kinda like the matches for the super wealthy you know I mean effectively taken and the non fund -- -- you put it someplace where you think that'll ride out the tide and you know I guess I'm not an expert by.
In -- very of those things but those are green sold to -- that -- about I mean all of these art auctions are just making money hand over fist.
We'll likely be a social commentary on the you know.
The disparity of super rich -- very little else but I actually think that it's.
That's probably a minor a minor subset of what's really going on economically but I do think it's -- point I do think that there's really -- for example treasuries.
What's different between put -- that and under your mattress I mean literally you're getting to a point now where US treasury might be -- Because you're losing many Iraqis might be safer about it.
Him on that point my Townsend thanks so much for joining us appreciate it funds tactics like --