Encouraging Signs in the Markets

This transcript is automatically generated

So Friday as you know this -- been a story of the markets the Dow finally closed about 141000 is the first time we saw that happen in about five years.

It is a new day new trading day and we've been in the red most of it -- right now the Dow is off 120 points.

Will we see the highs of Friday again -- was that just a once off please be joined by John Taft.

Wealth management's CEO John -- continue.

So what is your -- -- your clients to did today with the pull back.

Well I don't think the advice that we're giving -- clients has much to do with the pullback today what we've been telling them.

Is that they should get to their long term asset allocation targets you're telling them that for a year and of course the market -- moved substantially.

Over the course of the last stuff thirteen months 15% in 2012.

Then as you mention another 5% this year.

So we still well think that for investors who moved in the wake of the financial crisis.

Into assets -- they -- -- safe IE cash and bonds it makes sense to start gradually.

And carefully over some play in full period.

Getting back to neutral now what are we telling them neutral -- basically.

Your average balanced investor we think ought to have about 55% -- their money in stocks.

40% bonds and 5% in cash and I can tell you that most individual investors are much more conservatively allocated today -- And that interesting but what about people -- Debating whether or not -- now is the right time to get into the market you know you look at these fluctuations look at how far we've -- You know we have this big milestone the psychological level however want to characterize it on Friday but then this big pullback today.

So you know some people come until well you know buy into the -- -- -- -- and we appreciate your asset allocation high here but.

Your -- for people who might be a little gun shy right now.

Well.

I again I would say for individual investors the single worst mistake you can make.

Is to try to time the market so -- every parent every time you have a pullback it's an opportunity to buy.

Every time you have -- run up it's an opportunity to look at what asset classes of appreciated and rebalance.

But I would tell investors this.

Look at what your long term plan he has as far as asset allocation look at what your goals are -- don't have a plan -- one and then move.

Over six months or over a year to put that plan into place we think the environment for individual investors in the US.

Is pretty healthy you look out over the -- we were standing article.

About let's talk -- I -- him -- hero has done because you know we're discussing that.

The question of whether or not we're in a bear trap here is our last report Elizabeth MacDonald we've been watching -- -- equity inflows huge for January.

Is it for real a lot of criticism on the Fed manipulating rates these record lows for so long right now on is the market health for real.

Well that's what I was just gonna say look at all the positive indications on the other side of the valley you've got.

Accommodative central banks all around the world keeping interest rates low and doing everything they -- to spur growth.

Banks are is healthy and they've been since the financial crisis and they are lending again.

You've got.

Energy costs going down an energy independence.

Becoming a reality in the United States the housing market is bottoming in the US.

China has new leadership.

And they are accommodating growth and as you mentioned at the top of the Shelby European crisis -- stabilized.

All vols are positive indicators don't worry the market hang out this year the Dow and the S and -- -- inside the markets up.

We see the markets up double digits 10% north of that we -- half of that now but we're gonna have some volatility.

Because let's not forget.

We still have the triple witching hour of debt ceiling how you fund the federal government.

And and other fiscal issues in the United States coming to a head in April we've got to get through that.

Before we can look at the market being on a sustained up passionate I think the market's good better -- part of the year then the first.

Okay luckily -- their John thanks for joining us today.

Watch Live

Encouraging Signs in the Markets

Details

Clips

Latest Video

Did We Get Any Answers from the IRS Hearing?

Former IRS Commissioner on the Scandal

Why Did No IRS Employees Come Forward?

Will Scandals Hurt the Democratic Party’s Future?

Lack of Money: Politicians Favorite Scapegoat?

Sexual Assault Crisis in the Military?

No Signs of the Markets Easing?

Rep. Forbes: Culture of Arrogance in White House

Luxury Hotel Goes to the Dogs

NYC Photographer Selling Photos of People in Their Homes?

Seniors Delaying Paying Off Mortgage to Invest?

Florida Shortening Yellow Lights to Boost Revenue?

Transcript

Recommended