Goldman Sees Fear of 'Cliff' Hitting Stocks Next Quarter |
| CNBC - Sep 24, 2012 |
Goldman Sachs strategists expect the “fiscal cliff” to push the market lower in the fourth quarter, and they recommend investors sell the stocks that have lagged so far this year.
Goldman [GS 117.41 0.69 (+0.59%) ] chief U.S. equity strategist David Kostin writes that the S&P 500 should fall sharply after the election when investors finally realize that there is a possibility that the so-called “fiscal cliff” will not be resolved smoothly. He says the majority of investors expect to see the fiscal cliff avoided in the lame duck session of Congress, but Goldman sees a one-in-three chance that Congress will fail to address the issue. (Read More: What Stock Market Is Saying About November Elections)
The so-called “cliff” is the slam the economy would take from the expiration of Bush-era tax cuts and the automatic spending cuts that will hit the budget Jan. 1 if Congress does not act. The $100 billion spending cuts were agreed to as part of the debt ceiling compromise and are onerous, with a disproportionate hit going to the defense budget.
Read Full Article from CNBC
- Posted: 2012-09-24 14:58:58
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