You're watching...
Robert Pavlik, Banyan Partners chief market strategist, weighs in on what action he believes the Federal Reserve will take, and the fiscal cliff’s i...
Also in this playlist...
Auto-advance: ON
Auto-advance
This transcript is automatically generated
Investors obviously closely watching the latest developments on the fiscal cliff plus -- -- that the Fed guess what -- will continue its bond buying programs next year.
Well for more on the markets I'm joined by -- -- like he is chief market strategist at by union partners Bob thank you so much for being here.
I outlets that get to this fed issue first so walk is what I say they gonna expand -- or continue them.
Program of buying assets what impact does this having an enemy.
Operation Twist is what they're calling it right end up doing is actually the they sell the short paper and they -- -- long arm the long term bonds.
In order been in an effort to try to continue to keep a long term interest rates low.
Really what it's designed to do was encourage people to go while -- borrow some money comedy.
Go out and buy a house.
And it it has had very little impact on the overall economy has really done wonders for corporations were going out and issuing new bonds but they're not investing in their -- well that's business that's -- problem exactly I mean if they were going out and they were hiring new workers or investing in plant and equipment that would be great for the economy.
But I don't see that happening until we get some real results of these issues that are going on are you worried about inflation you know US inflation -- combat it hasn't been an issue up to now no -- in the one of the reasons as we have this cap being put on us by other parts of the world such as China you're seeing right -- -- growth in China.
We're also seeing a slowdown or really a recession going on in Europe it's like think that's what's also going to keep a lid on inflation going -- We will start to see inflation but I don't think it's going to come yet.
These seven market gyrations is all thanks of course to the talk about the fiscal cliff with the statement made by -- Democrats all the Republicans the market reacts.
-- and I -- it's tough to trade in this market isn't it it is but if you're long term investor you really have to look past all of this noise that's going on I mean we we had all these issues really known for us.
For at least the last year we we continue to see Greece continue to pop up being issued to the overall market get people scared get people out of the market they come back in the market we -- -- concerns about earnings season really turned out to be sort of a non event we had a concern about the the election that turned out to be another big non event in the up then all of the concerns really sort of been shipped over.
To the fiscal -- Now there is a big potential that that could have a drag on the US economy going forward I don't think we get to that point -- I think that it's going to be resolving I do believe that between now and the end of the first quarter and -- -- -- ways away you know that we do get a resolve but I think as we approach the end of the year we hope we can get some kind of -- ensure guidance by either the folks out of Washington that they're coming through to some kind of resolution on it and assuming there is some -- resolution what does that to the market you'd expect to -- how they get -- absolutely I think you probably see a major -- -- you'll see this market start to really recover and start to see people investing for the next year year and a half out.
What -- what it's going to do when we get this sort of resolution now it's going to clear up the concerns Iraq their big businesses have been sitting largely on the sidelines investors sitting on the sidelines.
Now you're going to start to see businesses understand where their course are going to be they're gonna understand their -- people and exactly and they can understand.
All what kind of order flow they're going to see because the -- what you what's going on in Europe they know what's going on in China and I do believe that you're going to see this market higher from here from now take away some of this uncertainty about Catholics -- -- -- very welcome appreciate it.
