Bad and Good Advice About the “Fiscal Cliff”
By Dan Solin
If I hear “fiscal cliff” one more time, I will consider jumping off a real cliff. The financial media is in hyperactive overdrive, breathlessly dispensing what passes for investment advice. Here are some typical examples:
Over at CNBC, Jim Cramer told his viewers to buy Cisco Systems (CSCO), Home Depot (HD) and PetSmart (PETM). He believes these stocks, among others, would be trading higher if the fiscal cliff was resolved. His logic is simplistic: These stocks are “recession proofers” and “big yielders.”
Yahoo!’s Breakout had Todd Schoenberger, managing principal of The BlackBay Group, as a guest on its Nov. 16 show. Mr. Schoenberger commented on the recent decline of Apple stock. He noted ominously that “[A]pple is a true proxy of the global economy.”
Sam Collins, the “Chief Technical Analyst” at InvestorPlace, believes “fiscal cliff confusion” creates a “buying opportunity” for CVR Partners LP (UAN). He notes the stock may be “… a temporary victim of fiscal cliff negotiations.”
I am sure you get the drift. Unfortunately, many investors will act on this advice, which is unfortunate.
