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Don't Sweat the Cliff?

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    Wells Fargo senior equity strategist Scott Wren on the markets and the fiscal cliff.

  • Duration 3:58
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Market gains are -- a little bit here the -- up 63 points.

My next guest says though don't sweat the -- the full effects of the fiscal clip will be gradual.

And we -- -- altogether joining me right now is Wells -- senior equity strategist Scott -- with.

Negotiation Scott it's great to have you back with best.

Let me just get your reaction glories of the day hi there that -- John Boehner now reeling.

To raise the threshold increase taxes for those making a million dollars a year Boehner the present course also meeting today are we any closer to any kind of resolution here.

Well you know I think there's a lot of things going on in the background that we're not going to hear for awhile if we ever hear them but.

You know let's let's be honest here I mean I don't think you're going to get out of this fiscal close situation without raising taxes and I think got the -- -- people that would argue that.

You know to earn 50000 dollars and in come you know is not is not wealthy at least some parts of the country but tough.

I think.

John Boehner wants to.

He's willing to raise some taxes I think taxes will be raised on a narrow swath of people but you know in my opinion.

We we have a spending problem yeah we don't really have a tax problem so you know Lou had mentioned in your last segment three to one spending cuts to our tax increases.

I mean I think that's pretty reasonable but I'm not sure we're gonna see that this time around.

Little also -- an -- attack that was that was compelling was -- you -- CEOs need to stop wringing their hands and act like adults and just go ahead with the business at hand and wanna work isn't the small business survey which shows sentiment confidence in -- three year low.

What you think of that disconnect do you think that business -- -- at this point -- just using this as an excuse.

Well I don't think that they really are and maybe maybe maybe you know some are but I would say the vast majority are not because.

They've got a couple of concerns one is there there just -- certain that the economic recovery is going to continue.

Then you know what are my tax rates what regulations -- -- am -- going to be facing how much is it going to cost me to hire.

Another another employee so I think those are legitimate.

Concerns.

I think that business owners in a way -- are hunkering down here there's several fronts that they're worried about.

And and I think that tell -- I think that's a legitimate excuse.

To hunker down and see what happens.

Get the most productivity can out of your clients and wait for Wafer.

No more clarity.

Yeah the IRS and studies -- say no with no clear idea what tax rates are going to be we're gonna see significant delay in refunds and that could have a meaningful impact on.

Consumer spending and that alone could really -- -- -- to zero growth negative growth territory what we think about that and what could be implications.

Well you know you know first of all -- I think.

You know big business confidence is the foundation in my opinion which is which consumer confidence is built on and consumers have been feeling.

More confident.

You know the labor markets a little bit better gasoline prices are down.

And so there's there are some things that are making people feel better but.

You know consumer spending is certainly based on confidence and if the economy slows down your -- fourth quarter probably isn't going to be very very good.

If we see CEOs and small business owners start to talk about.

How many people are going to lay off if we go over the fiscal -- -- -- believe me they're gonna be out in force talking about that.

-- -- consumer confidence is going to go down from the current levels case.

I am I pressed for time and I just want your take on -- -- are you calling these markets as an equity strategist stocks or holding out holding back a little bit.

And I mean I'm pullbacks -- we wanna be buying stocks here we're not gonna roll over the fiscal cliff we may be technically over for a few weeks.

If but but we're we're gonna have some sort of an agreement it might be good it might be bad.

But we want our clients buying on these steps economically sensitive sectors economically sensitive stocks.

Appreciate your take is always got rental -- -- -- -- -- -- --

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