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The Day Ahead: Welcome to Your Personal 'Gut Check'

From a life-advice perspective, I am in favor of a couple of things. One is giving the underdog, scrappy, no-name person a chance to prove themselves and challenge the larger, more established individual. The Rocky-type figure brings a sense of freshness and energy to the status quo, and you'd be surprised what that could create to benefit others. A great example of this in play is Total Nonstop Action Wrestling's "Gut Check" segment, wherein a person is given a shot at a contract with the company if they impress the fans and judges in a match. Boy, although these "rookies" are still wet behind the ears, they definitely put on an amazing show that could teach the complacent pros a lesson.

Playing off this theme, I say to you that today is "gut check" time -- and you be the judge in figuring out how to vote.

On the one hand, there Wall Street, clinging to the view that the sky is the limit into year-end on the S&P 500. Still, that crowd has quietly developed this general catch phrase to cover their rear ends after a week or so of returning volatility: Though optimistic on the long-term, we acknowledge the next move in stocks has a higher probability of being down 5% than up 5%. Let's call the Street the established, household name.

On the other side of the ring is Mr. Market, a formidable force, and one who is jumping around trying to capture the attention of the judge -- i.e., you -- as it cites reasons for greater caution. You, as the judge, may be torn between two factors. You might have missed the rally from the June low but, perhaps, remain cool to the thought that the S&P 500 will trade higher into fiscal cliff at year-end -- and that you should chase cyclical stocks, per the advice of the pros.

Oh, did I mention your attention is also being diverted by price-to-earnings multiples that are supposedly very, very attractive compared to historical averages, as earnings will surprise to the upside? You're also potentially ignoring sluggish revenue from companies such as Dell (DELL) and Hewlett-Packard (HPQ - Get Report), as they are struggling behemoths -- right.

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