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Moneynews Ultimate Wealth Editor Sean Hyman and Barrack Yard Advisors CIO Martin Leclerc on the factors that could drive the market higher in the year...
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Meanwhile the stock market rally today on the last day of trading for 2012 love that the Dow up a 166.
Points at the close largely on fiscal cleft.
There -- ending the year up seven point 3% which begs the question where we had been 2013 and how should you position yourself.
Here with their own outlooks one more bullish than the other shot -- editor of money news ultimate wealth report and Martin look clerk.
Portfolio manager of Barrick yard advisors.
I think we'll start with -- shine what do you see is the outlook for 2013 I understand your pretty bullish.
I am I think stocks are gonna hit higher in that 2013.
I think a lot of other countries will possibly -- better that we will hear -- in the US.
-- our earnings are priced priced pretty fairly stocks are are not undervalued they're not overvalued here.
They are undervalued in places like China and India and I think that's where a lot of the money will go so we will go up in US stock market I believe but but we will see.
Even bigger percentage rises in in both China and India.
-- -- -- it when you look at this I think that you know folks are -- is 600 billion dollar hit to the economy higher taxes lower government spending.
What do you think's gonna happen.
Well we think that that we'll probably see a mid cycle slowdown but importantly valuations and not that attractive.
The bond market is really in a bubble we believe and stocks are up 20/20 5% depending upon which market you're looking at.
So we would say and 2013.
Whereas in 2012.
The issue was don't be.
We guard against not being optimistic enough.
We think -- 2013 one must guard against being to a lot of it -- -- yes yes -- -- -- it.
China -- is there hasn't been a little complacency in the market and in what we've seen -- markets traded down on all this fiscal -- talk it's been moving on that.
You're bullish what do you think -- stocks are -- -- be rising on what will be the news that will propel the stocks higher.
Well -- a lot of it is really the healing of the global economy.
Now that you're starting have China and India both stabilize and had higher.
That's gonna help pull the global economy the last year to eventually then that US's job.
And they -- Case carry into the time and point -- -- it's gonna be China and India so I think as you see thanks -- and and head higher than here that's gonna improve global sentiment.
Our eight Martin do you -- have an outlook on what investors should do hear you talk about changing asset allocation.
Redefining what constitutes safety help us understand.
OK so the first thing is that we would use this -- complacency were experiencing and the optimism to to take profits.
For risk assets we think one should be about 20% in cash.
And we would be defined for.
We believe because of that bubble in bonds that safe investments a paradox that we don't say months -- -- But other things that are traditionally considered to be safe like utility stocks and RE ITs.
Things that are -- really depend upon the cost of long term money we think are in a bubble.
You say that volatility can be your friend why well because downward volatility can create buying opportunities if you positioned for our buy things lower -- -- -- high.
Buy low and sell high that's -- is the case.
Shot -- you if you look at this market going forward let me tell -- we -- showed these numbers CS and 13% this year.
NASDAQ up seventeen pursue you know what's interesting about this I thank.
Is that I don't.
Believed that a lot of people really know that that kind of move this has been hat I think a lot of people of Mississippi because they've been too nervous about stocks they have a one in the play.
Do you think it's possible of they'll get in the markets now and now haven't yet another unpleasant stock experience.
Obama I think the markets -- continued to have higher so I think there will probably come in they'll come in a little bit late to the gain.
Did to the game so they'll miss a lot of greatest gains to be had.
Abacus sometimes people think that stock move that always follows economic movement but as we see from the -- prior to that really hasn't been the case.
That's absolutely right and that -- -- it.
Do you think the economy can't continue expander -- -- -- but what is your crystal -- tell you how we don't have a crystal ball but we do think this too much debt demographics.
Not favorable in the western world.
And the developing world -- is experiencing a slowdown so we would really wait for our pitch right now.
And not rush into this market paring back of a move to -- -- somewhere that's clearly what needs to have it shot right thanks for coming on to both of you and happy new year have a great night thanks Terry.
Well having you happy new year to you now.
