12.12.2013
Businessman and former US Politician, David Stockman
explains why he thinks there is a pending market bubble. The bottom-line
is everything is overvalued and the market has to correct itself. Click to see clip: http://bloom.bg/1jDv7eH
Bruce Nazzaro, VP of Business Development at GovStreet
Capital, commented on the clip. "I agree with Stockman's simple
analysis—over-exuberance. It won't be a bubble burst like we saw with the
housing market, but a slow leak. There's not a lot of substance
supporting the DOW surpassing 16,000—housing still has problems, the bond
market yields a mere 1.75% on 10-year bonds, and employment is not ideal (but
improving)."
The timing of this bubble brings up a dilemma: Do
investors ride stocks into 2014 and risk a sharp decline in value, yet minimize
their tax impact? Or do investors liquidate their stocks to avoid
potential stock losses and absorb 2013's tax impact? Mr. Nazarro
comments, "I would scrape my original investment off the table, liquidate
my position, and sit on the sidelines through 2014; or find an alternative
investment that is lower risk."
