Submitted by
Wall St.
Daily
as part of our
contributors program
.
My latest research pinpointed the most pressing issue
influencing investor behavior right now.
Nevertheless, I want to get a final confirmation, straight from
the horse's mouth, which is where you come in today.
In a moment, I'm going to ask you to speak up. So get ready. But
first, let me describe what's going on…
Too Many Indicators Zigging Instead of Zagging
Many of the market indicators I regularly track are not behaving
normally. And it's been this way ever since the presidential
election ended.
Take high-yield bonds, for instance.
When stocks sell off, high-yield bond spreads typically spike,
as a weak equity market stirs up concerns over increasing
defaults.
But that's not happening. As Bespoke Investment Group confirms,
"High-yield spreads have been relatively subdued."
Same goes for the default risk for financial institutions, as
measured by credit default swap (CDS) prices.
As I've noted before
, they typically spike, too, when stocks sell off.
Again, no dice. CDS prices haven't budged like they should.
Then there's the puzzling situation in dividend-paying stocks.
When the broad market sells off, investors typically run for cover
in dividend-paying stocks - which, in turn, boosts prices.
That's not happening, either. To the contrary, all stripes of
dividend-paying stocks are down since the election by as much as
(if not more than) the broader market.
So why would investors be selling stocks and not bonds? Why
wouldn't they be seeking safety in traditional havens? And why
wouldn't the weakness in the stock market be causing concerns about
the financial stability of our banking system?
The Only Logical Explanation
The only possible explanation is that the Congressional
squabbling over a compromise to the Fiscal Cliff - the slew of
painful tax hikes and spending cuts set to kick in on January 1,
2013 - is influencing investors.
In other words, it's scaring us stockless.
We're not only holding back on new investments, but we're also
liquidating the stocks we already own to reduce our tax bill.
Now, I already alluded to the Fiscal Cliff being the biggest
concern for
Bank of America's
(
BAC
) well-heeled bond clients. And a recent CNBC article pretty much
confirmed the same, profiling advisers with high-net worth clients
that are "dumping assets amid worries about going over the
'cliff.'"
But let's forget about Robin Leach and the lifestyles (and
actions) of the rich and famous. I want to confirm without a shadow
of a doubt that the Fiscal Cliff is directly impacting the majority
of everyday investors like you and me.
If so, I'm prepared to hold an Emergency Fiscal Cliff Summit to
discuss precisely what's going on, address your concerns and - most
importantly - discuss how we should go about protecting our
portfolios.
The format would be an online webinar, or maybe a series of
them, so that everyone could attend no matter where you live. And
we would archive it, too, so you can review it at your
convenience.
Why even bother? It's simple, really.
As I'm sure you can agree, there's a lot of misinformation and
uncertainty swirling around in the market regarding the Fiscal
Cliff. And ever since we founded
Wall Street Daily
, we promised to be truth tellers in a world of liars.
We meant it. And this is just another way for us to demonstrate
that commitment.
On top of that, there are a lot of "what if" scenarios to
consider. And since my team and I have been tracking the situation
so closely, I'd like to be a totally unbiased resource for you to
navigate the implications of the many possible outcomes.
That being said, I can't justify investing the time and
resources to pull together a 100% free event to my publisher if
you're not truly interested.
So here's how you can help me out. Answer these questions…
- Is the Fiscal Cliff influencing your investment decisions
right now?
- Is confusion over the possible outcomes keeping you out of
the market?
- Are you desperate for someone to cut through all the
political brinkmanship to get to the heart of the matter (i.e. -
how to protect and position your portfolio as the Fiscal Cliff
approaches)?
If you answered "yes" to any of those questions, simply click on
the link below to confirm. However, if you think the Fiscal Cliff
is being totally blown out of proportion, and it's not one of your
pressing concerns, click the second link.
YES! A Resolution to the Fiscal Cliff is My Biggest Investing
Concern
NO! The Fiscal Cliff is NOT a Pressing Concern of
Mine
Based on the number of responses we receive, we'll make a final
decision on whether or not to hold our Emergency Fiscal Cliff
Summit.
With over 200,000 readers, we're going to let democracy prevail.
A majority of you needs to speak up before we even consider moving
ahead with our plans.
So again, click on the first link above to let us know if the
Fiscal Cliff is, indeed, the biggest concern for you personally
when it comes to investing right now.
Once you click the link, you'll have the chance to let us know
what your specific fears are. That way, we can tailor our potential
webinar to address the most widely held concerns.