NEW YORK (TheStreet) -- The old Wall Street saw goes something like: buy on rumor, sell on news.
Ever since the Fiscal Cliff came into focus during the latter half of 2012, this old chestnut seems to have been perverted into something more like buy on rumor and sell on rumor too. The news part, or facts, seems to have gotten left out of the equation.
Fiscal cliff be damned. I'm a card-carrying bull for 2013. In fact, for the balance of the year, I'm ignoring all "Fiscal Cliff" news and headlines. This isn't just a declaration of independence from the fourth estate. Since I actually run money for the GMG Defensive Beta Fund, it's an actionable strategy.
Here's what's behind going long on equities heading into 2013.New home construction. Privately owned housing starts in October were at a seasonally adjusted annual rate of 894,000. This is 3.6% above the revised September estimate of 863,000 and is 41.9% above the October 2011 rate of 630,000. We're so focused on housing leading the rest of the economy into the mire that we forget that it can lead the economy to new heights as well. New housing works backward into everything from utilities to durable goods to services. The outlook remains promising. Building permits in October were at a seasonally adjusted annual rate of 866,000, below the September rate of 890,000, but 29.8% above the October 2011 estimate of 667,000 building permits issued. China. The reports out of the east with China's economy showing deceleration were chilling to the markets during 2012. To me, the whole notion that it has "slowed" to something like 7.5% GDP growth is silly: 7.5% is an awfully big number. If the U.S. economy was growing at this rate, "Helicopter Ben" Bernanke and the rest of the Federal Reserve would be looking for ways to slam the brakes on the economy. There's something else going on in China that comes to me from Howard Balloch, head of Canaccord Asia, which is the Asian arm of global investment bank Canaccord Genuity.
Select the service that is right for you!COMPARE ALL SERVICES
Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.
- Real Money + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV