John Stancavage: Investors' focus shifts after ballots to 'cliffs'
BY JOHN STANCAVAGE World Business Editor
Sunday, November 25, 2012
11/25/12 at 3:01 AM
The stock market hasn't given President Barack Obama much of a reason to smile yet in his second term, but that cool reception likely isn't completely related to the outcome of the election, an adviser says.
Bill Greiner, chief investment officer of Mariner Wealth Advisors in Leawood, Kan., says that with the presidency decided, investors refocused on the nation's pressing financial problems - the so-called "fiscal cliff."
Tax cuts from the George W. Bush era are scheduled to expire at the end of the year, and the country is facing a $1 trillion budget deficit.
"What Wall Street wants to see is not just a bunch of legislation patched together but a real fix for this situation," Greiner said.
He spoke to me in a telephone interview recently ahead of a speech to clients of Adams Hall Wealth Advisors in Tulsa.
Defeated presidential candidate Mitt Romney would have faced the same issues if he were elected, but his plan to slash government spending might have brought slightly quicker results as opposed to Obama's more tax-funded approach, Greiner said.
"At the end of the day, either plan should have us end up in the same spot," said Greiner, who is a frequent commentator on television and in the Wall Street Journal. "We have to get our fiscal house in order."
In the last decade, many businesses - and the nation - lived on credit. But the recession broke that addiction.
"In the past four years, the trend in the business world has been toward deleveraging," Greiner said. "It's time the government joined the parade."
Along with domestic weakness, investors also are worried about continuing problems in Europe and elsewhere, Greiner said. "About 30 percent of the world is currently in a recession."
Looking forward, Greiner says slow growth will be the norm.
The U.S. economy, he said, likely will expand only 1.8 percent this year and 1.7 percent in 2013.
Even in that environment, some stocks will do well, said Greiner, whose firm manages about $13.5 billion in assets. The industries he is watching include infrastructure-type construction and manufacturing.
"I also like energy stocks," the adviser said. "And I'm not saying that just because I'm talking with someone in Tulsa."
The shares of many energy companies have been knocked down by falling oil prices and continued weakness in the natural gas market. But things could change quickly, he said.
"There are some very strong buys out there."
Original Print Headline: Investors' focus shifts after ballots to 'cliffs'