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Futures closed but in the meantime let's get to our panel we have Sam -- -- S&P capital IQ chief equity strategist at Charles -- He is trim tabs investment CEO and portfolio manager Sam I wanna go to you first.
You have always -- it's a GDP is usually slow in the first year her presidential term whether it's or re -- are not.
Probably happen this one as well how much longer can the markets continue to grow double digits while the GDP is is basically flat.
Well -- our GDP is basically flat but we have to realize that 50% of the revenues for the S&P come from overseas operations and -- still -- -- -- -- we're looking at about 8% growth is expected for 2013.
In -- many of the emerging markets so you know -- -- -- -- -- players -- you gotta -- where the action -- and so the action happens to be in the emerging markets we -- certainly a low flying economy that is susceptible to downdraft and the fiscal -- could provide that but valuations point -- under valuation -- between fifteen and 20%.
Charles you've got your bear claws out I know you're very cautious on a regular basis we've known each barrel on time but.
-- it's obvious that the headline risk is pretty high as we get closer closer to the fiscal cliff but.
Let's -- we get a dealer we don't -- -- still see very weak equities in 2013 why don't you have -- let.
We're starting to see a recovery in the housing market certain metrics of this economy are looking slightly better.
Well take home pay for every -- after tax income is up 300 billion.
This year over last year's six point six trillion in aggregate -- homage your taxes gonna go up next here -- 300000000500.
So how could you have a economic growth this the tax increases couldn't take away almost all the gain.
This year that would also -- -- know that the 300 billion gain.
Cost the economy over a trillion dollars in subsidies.
We had deficits and the Fed printing money.
Of over a trillion dollars all of that -- her hated 300 billion gain horribly ineffective and inefficient.
But it looks better than no gain I guess.
So what I see for next year there's only one economic stimulant -- -- and that's sandy rebuilding.
The real time data we traction has shown a pick up and and then comes since the middle of November and we actually think jobs grew a little faster than the fake number the BLS puts out.
But the so we see very little growth next year assuming any income tax at no growth if a lot of income taxes go up.
And how do you have a fifteen PE.
And an economy not growing doesn't make sense about.
Don't believe it or not this guy actually does have stock picks and we're gonna get to those -- Charles.
But -- what you hear an analysis is dreary is that.
Did does -- make his sort of rethink your own it now also -- Are you fighting that war are you going with the trend of the of the market do you think.
-- David anytime I hear commentary from a Smart individual like Charles like do look to my data once again my belief though is that we are on an upward trajectory.
And that this is all the reason why those in congress have to be careful.
Not to embrace the austerity program to tightly because that could have a deleterious effect.
On our economic growth which which you would hurt more by the way higher taxes or lower government spending.
I think would hurt me both.
That I think that got.
I think higher lowered to.
By lower government spending probably helped -- the economy I think the government.
Probably gets thirty cents worth of war effort or accomplishment out of each dollar spent a -- -- so I can't secure our choices are both the view because Charles you do like -- you like some large cap technology names but I -- to get to the -- specifically right now we can put the -- Amazon apple.
-- goods as a -- you like and you also like sales of its whole foods I'm sorry.
Yes well I like companies that are growing faster than they're gaining market shared.
-- huge increases in free cash flow and as long as they're growing -- the fastest in their industry in the industry leaders.
I like to ride them for as long as that happens regardless of the economy.
OK and -- about health care obviously.
Republicans did not win the presidency we are gonna see a continuation roll out.
Of the new health care law that it's that area that that sector is one that you think is right for investment.
That's right we still like the health care group are feeling is that expecting to see an improvement in overall earnings growth.
Actually probably starting to see a pick up in the major pharmaceuticals.
Which is the largest group in the health care sector.
But we also acknowledged that -- -- in what I call the cyclical six the favorable six month period for the market in which these cyclical sectors like industrials like consumer discretionary.
Are expected to be outsized performers OK Sam Stovall by the way Charles -- -- very provocative I gotta ask you about do you think that numbers were.
We're -- -- little at the end of at the end of their presidential race.
I think the government's committee confidential for this real time data available -- been -- and withheld withholding tax collections.
The government refuses to use -- I've asked them why did an op Ed piece in the Financial Times.
They would rather not even address the fact that they're ignoring real time data using surveys and technology from the sixties and seventies.
To come up with estimates at a time like this when we desperately need to know what's going.
On and our economy -- by the way that accusation has been -- that administrations from both sides of the Iowa for many years so Charles thank.
Has and of course as soon as we have war evidence will bring it to you thank you very much I have often and I saw our -- -- it was it was a very provocative piece.
In the FT and it did have some evidence thank you guys that get to see you as well thanks -- as.