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Joe Duran, United Capital CEO, and Jim Bianco, Bianco Research president, weigh in on the market outlook for 2013 and investor confidence.
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Housing starts the best they've been in four years so is the market ready for a big 2013.
Our guests say don't start celebrating yeah.
Get a Randy had a capital and Jim Bianco of Bianco research driving now -- is -- over the markets and the economy actually stand right now.
You know -- -- -- start with you because you and said that if the big cliff was not a murder of the country whatever the club.
Would have a recession on our hands we had a few hours of a cliff anyway do you feel any bit better -- begun the year.
A little bit better but most of the numbers that I see if you want to talk about the market and a fundamental basis.
They're not decorate the economy's growing below average its growing around 2% that's not a necessarily good number.
Earnings are around 3% for this quarter estimate for 1% for the next quarter kids are not very good numbers.
What we do have is we have a very you lose -- providing tons of accommodation.
And I think that that's been the story in the stock market for the last few months.
Well Jim I don't do wanna ask you about -- real quick you know weight or getting a reporting now about what Ben Bernanke and if -- talking about back in 2007 they seem frank Leo a bit I'm prepared.
There there -- their predictions for all is gonna happen with housing.
Where we're incredibly low to the -- of a few billion dollars.
Were you surprised at all by -- prepare the feds seem to be in 2007 -- -- that's the way remembered -- I was a little bit surprised but you know frankly from lied perusing of the minutes and there's hundreds of pages evident and have much time.
The Fed got run over by this stage they just didn't understand what was happening they didn't believe it -- know what to do and they were just.
You don't get the license plate of that truck that just -- over that was kind of the impression that I was left with.
All right -- and show you say that right now we are and what you're calling him.
Economic Groundhog.
Day what do you mean.
Well we've been three dozen or at least IPO well aware of optimism that we Andy yeah way it.
A lot of ground being asked about the coming slowdown so we think at the same thing's gonna happen again which is.
We can -- get through this.
We'll have a few months of noise about the the debt ceiling debate and and then they're just gonna.
And do what they always do it just -- the decision and then we'll get some stability.
And then -- -- don't worry about 2014 and so just to repeat cycle of what we've been seeing which is why.
Investors have so little confidence in who pulling ninety billion dollars from the stock market -- -- after a 16% of months.
And going into bonds which probably have the highest risk.
But generally didn't you say it's Groundhog Day I mean 2012 was actually a decent year -- -- -- was from a major.
And this season mean we made money and they wouldn't lose money we did lose ground in 2012.
Does not -- think that would be -- -- unsettling you believe that.
And how we think -- absolutely been making money for the last five years as you pointed out at least for the last -- -- since 2009 and 2007 has been fantastic.
The problem is the consumer is the average investor.
Is ignoring.
What's happening in the market because they're overwhelmed by the news and that's not gonna change so.
What we're telling people -- you've got to remove the emotions from the decision making -- because the market has been doing great.
You're just being overwhelmed by the news and again I think again it will be a good idea just the news will not because.
-- you're saying you're talking about doesn't like themselves basically from all the the chaos of those Washington DC these days and you know engine -- wanna get -- gets a couple things your fixed income god how do you feel about how the bond market for 2013.
-- -- -- had a few guests come out of the show now and say.
There there saying you gotta go equities forget bonds this year.
I would think everybody is that might -- is -- about 99% of the investor community hates the bond market.
It's outperformed the stock market for.
The last three years five years ten years fifteen years depending on what long term timeframe you wanna use the group and we've been arguing that as long as the Fed is continuing to buy securities at a rate of 85 billion a month.
In the economy stays below average the bond market is just getting in -- just find it could be a long time before we see rates rise.
We've been saying they're gonna rise any moment now for about ten years food and I suspect we won't it is for many more years we're gonna be saying before we see the rate rise.
OK I want -- -- does a couple of investment is really -- -- Joseph you're telling our viewers.
To avoid medium long term bonds.
But you're also saying emerging markets emerging international and developed markets of the stories -- -- -- Sidestepped the overseas we think the next few years going to be very interesting continuing the emerging markets theme which underperformed last yeah.
And secondly -- on global brands that can take advantage.
Of these huge flow of money and have the wealth creation that's happening in Brazil and China and India all over the world.
Africa I just came back from and what you're seeing is that the brands like that everyone knows from Procter & Gamble to Coke.
-- the front people are gonna buy and they you went on those companies.
All right -- get great dividends that are did dividends have been nice getting paid out because -- of a -- thanks to nothing new gender and Jim Bianco appreciate it thank you.
Thank you.
