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Fiscal Cliff and Your Portfolio

Posted by kdadmin on December 1st, 2012.

Given the amount of chatter in the news about the fiscal cliff, I thought you’d like a little perspective. While you’re no doubt aware of the fiscal cliff issues, the top issues are:

  1. Increasing the drag on an already sluggish economy.
  2. Prolonging unemployment.
  3. Reducing economic growth by increasing the burden on the private sector.
  4. Escalating debt load experienced by the federal government (and taxpayers by extension).

Some think that fear of the fiscal cliff creates a buying opportunity in the market. That it may. However, presently, all it is creating is turbulence, which impedes the market more than helps it. We will be watching for specific market changes. In the meantime, we’ve already addressed the turbulence in your portfolios.

In early November, we made significant allocation changes in your portfolios that put you in a more defensive stance, should congress fail to act, while still giving you some exposure to a potentially improving market. We did this by overweighting you in high yield bonds and an ETF that models the S&P500 (SPY).

If you’d like to discuss this in more detail, please send me an email or call me on my cell at 763-229-5569 and we’ll go through it.

Otherwise, have a wonderful weekend!

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