Iranian Election; Apple; Macro: Best of Kass
Jun 16, 2013 | 01:20 PM EDT
-- U.S. economic growth. Four years of easing has failed to produce much more than +2% real growth domestically. The uncertainty of a non-self-sustaining recovery will weigh on stocks if QE is tapered. -- Interest rate cliff. Tapering could result in ever higher rates. Our consumers, corporations and government are addicted to low rates. Moreover every discount dividend model depends on a cap or interest rate. Higher rates, in theory, reduce the value of future cash flows. Here is my previous column on the interest rate cliff. In other words, Jimmy, no corporation is an island! Never in history has our domestic growth trajectory been so dependent on policy, especially monetary. We are in an experiment, a big experiment. Buffett told the audience in Omaha in May that he knows not how they exit this experiment nor what the ramifications might be. There are other reasons why macro is important, but the above are some of the major reasons.
Check Out Our Best Services for Investors
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
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
- Model portfolio
- Stocks trading below $10
- Intraday trade alerts
More than 30 investing pros with skin in the game give you actionable insight and investment ideas.