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Caz Investments CIO Christopher Zook argues Americans and companies want to spend but the government and Europe are holding them back.
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-- -- -- -- -- -- the US markets are like -- tightly coiled spring.
But our next guest says there's a lot we did you before they can balance back up -- birds duck is chairman chief exit this investment officer of cap investments.
Go ahead sell some -- -- my friend I'm thinking stocks are just way undervalued here but go ahead depressed me.
No I'm not gonna -- -- but I will tell you that stocks are relatively fairly valued.
There's a lot of good things going on here in the economy there's a lot of things that will allow us to do much better going forward.
Companies want to spend money consumers want to spend money.
But until we get the heavy weights out of Washington and Europe.
-- that spring it's not get on oil pricing if you cite three main factors that are hold that's down right we've haven't -- full speed on that there's start with the Euro zone and Greece.
And Euro -- and Greece clearly if we have an unwinding of the Euro that is as as one manager that we work with called it a -- squared event.
That is something that is very very bad for everybody if Spain does not get their act together obviously that is very bad for the -- what economy.
Most of -- and most importantly it's just an uncertainty that is being created by what's happening in Europe.
It just causes people to be cautious and and -- -- -- as well right well Chris.
-- absolutely.
You know we're looking at a situation where we have a fiscal cliff we heard that this morning out of Goldman and -- monetary cliff.
These things are facing us going forward and companies are not going to be willing to invest capital -- hiring people aggressively until we get past the election.
So between now and then you've got six months of people just kind of sitting on their hands waiting to spend money.
That is not good for the economy is not good for the markets all right let's look at what you should put money that could you do say that.
We gotta go with the flow -- like cash flow well oriented stocks high quality fixed income go ahead.
Absolutely well we have to do is figure out how to get paid while we wait.
And let me be very clear we do see a cold spring with a lot of very good things that could allow the markets to go higher.
On on the other hand we also have the negative news but below us we have the Bernanke put.
So we don't expect to have this huge move up or this huge move down -- -- soon so in the meantime let's get paid.
We can do that through high dividend paying stocks here in the US also in Europe.
We get dual high quality short term fixed income.
And we can also do -- option overriding strategies that give us an extra income stream while we wait to get paid okay and you you like to forma ET after that high dividend category that right.
Sure we're not specific in any particular ETFs or we do morally individual stock names ourselves.
But when you look at the pharmaceutical sector.
You're getting and our particular case of four point 8% dividend yield.
You're getting great companies great balance -- solid cash flow and the potential of the catalyst depending on what we hear from the Supreme Court.
So it gives us a great way to invest capital where we feel confident.
That -- downside is limited that are upside is there if markets turn out to be good and while we wait.
We get -- Of almost a 5% dividend yield or three times what would -- get in a ten year treasury.
We're very comfortable with that market and longer -- in your retirement account though Christopher you would be buying stocks generally hear what you because.
You know investors missed out an 80% run up from -- 6800.
I would agree with that to a point clearly the best thing for retirement account as -- dollar cost average into the position.
You -- don't try to say today is the day we don't know when it's going to be and we might have another lost decade just like the last one.
But if you're constantly adding value to your investments through savings you're going to be able to over time get a great return out of equities.
Especially if you focus on high quality I'll stay away from low quality focus high quality thanks very.
