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South Texas Money Management President Jim Kee on the economic concerns weighing on the markets and where the opportunities are for investors.
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So let's go back to the markets and your money what are you all really reacting to hear and why -- everybody's so nervous overseeing the sell -- of 83 points.
Is the volatility index of that fear index still relatively -- -- well let's bring in -- key.
He is our guest today south Texas money management president and chief economist joining me for the last hour of trading you folks itself Texas don't scare so easily do you.
Well you know a lot of these things that people are worried about you know the big -- Middle East Europe fiscal cliff.
The evolving pretty highly telegraphed.
I think conceivable to me that the market hasn't pretty much priced in with noble.
Okay what's you -- -- so you're you're telling me -- criticize fed at the top of the show.
Is anybody surprised by this okay so the IMF says yes we are downgrading our estimates of growth for the entire planet of folks be smarter than the rest of these government agencies police.
We knew that was going to happen so are you still bullish on stocks.
Yes I think that BI MF is playing catch up you know I think everybody's coming had a -- everybody -- right so.
So that shouldn't be a surprise were pretty bullish on stocks over the next twelve months there's -- Pretty strong headwinds in the way of declining policy and so -- on the fiscal side that we should see.
Back in the next two to three months.
In general I'd say would be trading and have pretty -- trading range but given that run up we've had a pullback is kind of what you'd expect just looking at data.
We ask this a lot and it's getting to be a little bit of a boring question because we're not there yet -- like Chinese water torture but.
Facing a recession or going away from it and for all intensive purposes let's use a driving analogy.
If the US investor is driving a car is here she driving away from a recession or toward it and of investing accordingly would be to do -- That's a great question because.
The drivers of recession housing and autos have typically recessions are led by crashes or declines -- -- And hasn't -- time on the bottom for the last your -- are coming out.
That's one of the reasons I don't expect to recessions because this those strategies and consumer goods averting crash.
But how we are seeing one to 2% GDP growth that's consistent with the job numbers as well and that's uncharted territory for the US at this point in an expansion.
So you're saying housing has either bottomed or at least a slightly turning around and say what -- -- -- -- -- crash coming there right.
What about a potential bond market bubble you just heard Scott actually -- and and I thought that was very interesting about vanguard.
For the first time this gigantic fund management company I'm sure a lot of you on these vanguard funds.
Now has more people invested in bonds than stocks that tipping -- happened.
It's I think it's interest -- I think a lot of stock buy signal is what I'm trying to get -- to -- that was my interpretation evidently not has back at what would scare me as to flip it around and save money into equities or an all time high.
That would be cows that are of concern for me and that's kind of what I mean -- I think.
All these things the market is priced and I don't see overvalued markets and -- to.
Too much money in okay -- define the investing opportunity is it short term can it be long term like how we used to do I I would say it's definitely long term I would.
Avoid short term knee jerk responses like the plague it's time.
-- -- -- -- what -- your picks its Wells Fargo are you concerned about the news that just broke you know a little bit but not really and this is just an example of the kind of policy and certainly that financials in general are facing I think this.
This wells' case is just a great example.
Some of what they have to face and so we are have been underweight financials for these sorts of reasons that Wells Fargo is definitely that.
The best house in an improving neighborhood at by the way it's still holding pretty steady at.
