fiscal cliff stock worries

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http://www.profitableinvestingtips.com/investing-trading/fiscal-cliff-stock-worries Fiscal Cliff Stock Worries The stock market retreated recently on fiscal cliff stock worries, according to the news. So, what the Heck is a Fiscal Cliff? Fiscal Cliff is a political term. The fiscal cliff implies a rapid economic disaster upon letting the Bush era tax cuts expire, allowing mandatory Federal spending cuts to occur, and seeing an expanding budget deficit. The fact is, folks, there is no cliff in fiscal cliff. There is the risk of an economic decline and even a recession if the issues at hand are not dealt with in a responsible manner. However, the worst case scenario is a slow fiscal slide, which does not have the political pizzazz of “fiscal cliff.” Nevertheless, the market is worried and oft times market sentiment diverges from sound fundamental analysis, taking profits with it. Before letting fiscal cliff stock worries ruin our day, let us think about how the various aspects of the so called fiscal cliff might affect intrinsic stock values and margin of safety, the touch stones of sound long term investing. To the extent that the issue is overblown there may opportunity to pick up good stocks at low prices. To the extent that congress and the president resume the willful Capital Hill circus of last year it could be time to take fiscal cliff stock worries at face value and get out of the stock market. Hopes of Fixing the Fiscal Mess The mighty US dollar suffered a downgrade last year due to the comedy on Capitol Hill over raising the debt ceiling. The US Federal Reserve has been buying US Treasuries which has had the effect of driving down interest rates and forcing bond buyers into the corporate market. Interest rates on treasuries will likely go up and prices of treasuries will likely go down if the adults take over on Capitol Hill and work for the good of the nation and not their particular political constituencies. The long term results of coming to grips with the Federal Deficit with mixture of tax increases and even handed budget cuts, could spell a long term economic rally the USA and the world as well. Long term investors are well advised to watch to see if the current negotiations come to fruition of if the nation will continue to wallow in fiscal stimulus generated low interest rates, devaluation of the US dollar, and ever more staggering debt for future generations to deal with. Practical Approaches Success in long term investing comes from accurately picking the winners and avoiding the losers. If the US gets its fiscal house in order investing in gold will become less attractive. To the extent that the fiscal slide occurs precious metals may get a boost. During the upcoming period of uncertainty options contracts may hold the key for conservative investors. Puts can act as insurance on stocks that you believe to be at risk for a fall.

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  • 1. The stock market retreated recently onfiscal cliff stock worries, according to thenews.http://www.profitableinvestingtips.com/investing-trading/fiscal-cliff-stock-worries

2. So, what the Heck is a Fiscal Cliff?http://www.profitableinvestingtips.com/investing-trading/fiscal-cliff-stock-worries 3. Fiscal Cliff is a political term.http://www.profitableinvestingtips.com/investing-trading/fiscal-cliff-stock-worries 4. The fiscal cliff implies a rapid economicdisaster upon letting the Bush era taxcuts expire,http://www.profitableinvestingtips.com/investing-trading/fiscal-cliff-stock-worries 5. allowing mandatory Federal spendingcuts to occur, and seeing an expandingbudget deficit.http://www.profitableinvestingtips.com/investing-trading/fiscal-cliff-stock-worries 6. The fact is, folks, there is no cliff in fiscalcliff.http://www.profitableinvestingtips.com/investing-trading/fiscal-cliff-stock-worries 7. There is the risk of an economic declineand even a recession if the issues athand are not dealt with in a responsiblemanner.http://www.profitableinvestingtips.com/investing-trading/fiscal-cliff-stock-worries 8. However, the worst case scenario is aslow fiscal slide, which does not havethe political pizzazz of fiscal cliff.http://www.profitableinvestingtips.com/investing-trading/fiscal-cliff-stock-worries 9. Nevertheless, the market is worried andoft times market sentiment diverges fromsound fundamental analysis, takingprofits with it.http://www.profitableinvestingtips.com/investing-trading/fiscal-cliff-stock-worries 10. Before letting fiscal cliff stock worries ruinour day, let us think about how thevarious aspects of the so called fiscalhttp://www.profitableinvestingtips.com/investing-trading/fiscal-cliff-stock-worries 11. cliff might affect intrinsic stock valuesand margin of safety, the touch stones ofsound long term investing.http://www.profitableinvestingtips.com/investing-trading/fiscal-cliff-stock-worries 12. To the extent that the issue is overblownthere may opportunity to pick up goodstocks at low prices.http://www.profitableinvestingtips.com/investing-trading/fiscal-cliff-stock-worries 13. To the extent that congress and thepresident resume the willful Capital Hillcircus of last year it could behttp://www.profitableinvestingtips.com/investing-trading/fiscal-cliff-stock-worries 14. time to take fiscal cliff stock worries atface value and get out of the stockmarket.http://www.profitableinvestingtips.com/investing-trading/fiscal-cliff-stock-worries 15. The mighty US dollar suffered adowngrade last year due to the comedyon Capitol Hill over raising the debtceiling.http://www.profitableinvestingtips.com/investing-trading/fiscal-cliff-stock-worries 16. The US Federal Reserve has been buyingUS Treasuries which has had thehttp://www.profitableinvestingtips.com/investing-trading/fiscal-cliff-stock-worries 17. effect of driving down interest rates andforcing bond buyers into the corporatemarket.http://www.profitableinvestingtips.com/investing-trading/fiscal-cliff-stock-worries 18. Interest rates on treasuries will likely go upand prices of treasuries will likely godownhttp://www.profitableinvestingtips.com/investing-trading/fiscal-cliff-stock-worries 19. if the adults take over on Capitol Hill andwork for the good of the nation and nottheir particular political constituencies.http://www.profitableinvestingtips.com/investing-trading/fiscal-cliff-stock-worries 20. The long term results of coming to gripswith the Federal Deficit with mixture oftax increaseshttp://www.profitableinvestingtips.com/investing-trading/fiscal-cliff-stock-worries 21. and even handed budget cuts, couldspell a long term economic rally the USAand the world as well.http://www.profitableinvestingtips.com/investing-trading/fiscal-cliff-stock-worries 22. Long term investors are well advised towatch to see if the current negotiationscome to fruition of if the nation willcontinue to wallowhttp://www.profitableinvestingtips.com/investing-trading/fiscal-cliff-stock-worries 23. in fiscal stimulus generated low interestrates, devaluation of the US dollar, andever more staggering debt for futuregenerations to deal with.http://www.profitableinvestingtips.com/investing-trading/fiscal-cliff-stock-worries 24. Success in long term investing comesfrom accurately picking the winners andavoiding the losers.http://www.profitableinvestingtips.com/investing-trading/fiscal-cliff-stock-worries 25. If the US gets its fiscal house in orderinvesting in gold will become lessattractivehttp://www.profitableinvestingtips.com/investing-trading/fiscal-cliff-stock-worries 26. To the extent that the fiscal slide occursprecious metals may get a boost.http://www.profitableinvestingtips.com/investing-trading/fiscal-cliff-stock-worries 27. During the upcoming period ofuncertainty options contracts may holdthe key for conservative investors.http://www.profitableinvestingtips.com/investing-trading/fiscal-cliff-stock-worries 28. Puts can act as insurance on stocks thatyou believe to be at risk for a fall.http://www.profitableinvestingtips.com/investing-trading/fiscal-cliff-stock-worries 29. Calls will hold your place in line, at thecurrent price, for stocks that you believemight rise.http://www.profitableinvestingtips.com/investing-trading/fiscal-cliff-stock-worries 30. A practical approach during times ofmarket uncertainty is to search forundervalued stocks and profit as theirshare prices rise.http://www.profitableinvestingtips.com/investing-trading/fiscal-cliff-stock-worries 31. For more insights and useful informationabout investments and investing, visitwww.ProfitableInvestingTips.com.http://www.profitableinvestingtips.com/investing-trading/fiscal-cliff-stock-worries