5. Tax uncertainty: Not only will business capital spending plans be delayed by the lack of visibility in tax policy and the fiscal cliff but the likely rise in effective tax rates (on dividends and capital gains) in 2013 could result in liquidation of stocks in 2012. (In theory, the tax rate on dividends will increase from 15% to as much as 39.6% plus the 3.8% surtax on Obamacare.)

6. Band-Aids in Europe: There will likely be little progress made in the eurozone's continuing sovereign debt crisis. Britain's Nigel Farage puts the EU's plight clearly into perspective in a weekend interview:

You only have to open your eyes to see the increasing violence and division within the EU, which is caused by the euro project.Spain is on the verge of a bailout, with senior military figures warning that the army may have to intervene in Catalonia.In Greece people are starving and abandoning their children through desperate poverty and never a week goes by that we don't see riots and protests in capital cities against the troika and the economic prison they have imposed....The last attempt in Europe to impose a new flag, currency and nationality on separate states was called Yugoslavia. The EU is repeating the same tragic mistake.Rather than bring peace and harmony, the EU will cause insurgency and violence.

7. China's economic growth falls short, and the EU's economy sputters: China, the world's driver of growth, will likely disappoint relative to consensus. The Eurozone's economy has low expectations -- and even those low expectations will likely disappoint.

8. Possible technical breakdowns: The S&P 500 will likely breach 1425 support. Two important groups, financials and technology, pose fundamental risks. Financials face continued margin compression from zero interest rate policy. Among other issues, the technology sector is transitioning from open to closed systems such as Apple ( AAPL) in secular move away from personal computers, AT&T ( T) and Verizon's ( VZ) -- two large service providers -- networks have been built out, the weakening of global economies is hurting consumer spending for tech gadgets, and the move to the cloud is disruptive to technology sales.

9. The profit cycle erodes: Reported third-quarter profits and forward earnings guidance will disappoint relative to consensus expectations.

10. Valuations full: Stocks have not discounted the challenging earnings picture for third quarter 2012, fourth quarter 2012 and full year 2013. (My below-consensus estimate is $97.50 per share in S&P 500 earnings for next year.) The S&P trades at 14.7x. This is very close to the five-decade average of 15.1x, and during most of the last 50 years, the U.S. did not face the numerous structural headwinds with which we are confronted today.

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