Tuesday, December 7, 2010

Finally Obama Pulls Through - Cave in is some times nice

Thanks Mr. President, Finally caving in does feel sweet

Extension of Bush tax cuts for 2 more years
Preserving capital gains and dividends tax rate
Estate inheritance upto 5M no tax
Support for small business
Last but not least - reducing FICA to 4.2% - a 2 %r reduction
Is this too good to be true,
If parts of this passes before the congress breaks off i would be extremely happy -
This is a good sign and a setup for a STRONG JANUARY in 2011
2010 has been a blessed year with the volatility and corrections in February, June/July and Late August yet at a YTD double digit returns its been a good ride,
I would take a 10% year like 2010 with the bumps in the road any day over a 2009 or 2008
Hopefully the market keeps healthy volatility in 2011 and provides opportunities for all segments of investors
I still honestly feel the broader Equity market is undervalued with the Tech bell weathers still trading at 10-20 P/E, tons of cash on books, strong cash flow, earnings growth, certainly feel there are under valued segments in the market vs over heated segments such as Cloud, virtualization, boutique niche product providers in consumer space may it be a Burrito, Ugg Boots, Streaming video inverstors are cheering these segments shying away from companies like CSCO or INTC

The three domestic US sectors i would like to research for the next year

Financials - XLF
Health Care - XLV
Tech - XLK

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