Jan 8, 2013|
Congress Asset Management's CIO Peter Anderson on his 2013 Outlook
Transcript - Not for consumer use. Robot overlords only. Will not be accurate.
Taking a look now at the state of the economy we are joined by Peter Anderson from congress asset management Peter how are you this morning. Are you doing pretty well and we've we've survived into the nuclear impasse over the fiscal -- at this point. But what are the big issues that you're looking at coming up for investors over the next three to six months. Well first the ball deep amber was one heck of a month in terms of the volatility. And just hang on every word coming out of Washington so where are we believe that that's behind us and I think that's. Agree guilt psychological boost you in the past couple of days or so I'll -- it yesterday of course all of our relief. But coming up of course we have the debt ceiling talks but you know -- this time around we've been here before and on the market hate uncertainty that is actually. Can live -- is a track record of water and -- something like that so this time around I wouldn't exactly it's going to be a piece of cake but at least we know that. Diligent in making the decision had done it before and I did not personally to worry about that in terms of how that's going to impact the market. Secondly once we breakthrough that ceiling. I think the next issue will be the European situation you know. In the past we've kind of forgotten all about what's going on all the aircraft that great -- plot that they can't but that will still come back to -- To -- to bed and I I think there'll be indexed issue there wouldn't be focusing on. And so obviously those -- the two big issues that you're concerned about for this year but how do you view. The the markets performing over the rest of 2013 obviously those are two pretty big things that we do need to deal with for what do you still have some optimistic expectations. Possibly once we get past those issues. I obviously I am optimistic last year even with all that stuff that has been going down we still -- you know 60% return in the general market that is. Amazing. Given the fact that we've had so many questions. And a lot of those questions still are on answered so. I think that's going to be a constant game in the background that we will always have these questions Wall Street always give out things to be concerned about. But going forward. I think that the US markets offer. A lot of attractive opportunities but he do have to work really hard at finding those opportunities I would not say just blindly invest in index. While looking at certain companies are keen that you political play out of 2013. In one place that investors are a little bit concerned about at this point not an equity markets. But looking at fixed income a lot of investors have expressed some doubts about the fixed income markets over the next several years what is your view on bond holdings over the next couple years at this point. Well everybody that now at about bonds now is that inflation will be bad because their rates will increase. That being said bill let's just think about it rates are increasing that does mean that the economy will be eating out. So you can't have it both ways you will outlive. Increasing growth he will have increasing yields which quicker certain bond holders especially if you're just in the generic. Bonfire and we don't have -- -- that the maturity goes on but the way we do. Is we shall call latter abroad so we have a streams are different bonds with different maturities. So that when -- mature early you can reinvest that money. And -- -- higher yielding bond sell it takes care of the fact that rates would be writing. You just have to be very very careful as to how the structure of the portfolio is so you can accommodate. And utilize those -- Sidetracked to if you cannot just so long term bought on -- to hold on to that. Without doing these kind of maturity you would have more pain -- rates went up. Certainly -- and you know that I think is a big concern for a lot of investors that. You know in times like this they have been heavy in fixed income -- trying to avoid some of the ups and downs of the stock market so it is important for investors to know some of the risks that are out there. In the bond market but it. Turning now a little bit to what's going on today we do have Alcoa reporting earnings and looking at this upcoming fourth quarter earnings season. Obviously the third quarter about his dismal as you can get so what are your expectations. For this quarter coming after such a weak quarter of earnings. Well you know most companies have revised. Downward and away so that they've lowered the -- -- everybody likes to say. And they probably will meet those expectations. But let's face it -- -- Porter has been one. Total disarray in terms of how companies have been thinking about that fiscal cliff. And so I don't really expect. Most recent quarter to give -- a really good litmus test. Of the way the market is people have been on holes -- just past three months. And I think companies have been true waiting to what has come out of Washington. So I think you're going to look at those earnings take it in stride. They will be of course some supplies is but even if they beat those earnings it will be far less. Average growth period that you would expect under normal circumstances so it's kind of media profile quarter. And going forward is when we're actually going to start to -- Leave the real. Results. Some optimism. Last quarter -- as. Everybody that. That we're called. And just briefly Peter. Any other trends that you're looking at now that most investors might not have on their radar at this point to some things that might be a little bit different from what -- -- -- thinking. There is some interest in things that we've been looking out so this year we think that. If even if you have it sideways or slightly upward market in terms of earnings. There will be other opportunities this year follows will do their company. Two of the things we think it will you'll see our stock buybacks for instance there's a lot of national ballot sheets. It's kind of burning a hole and corporate America has. Pocket and so they would like to. Used that -- in a way that's not as risky as they outlawed acquisition we've seen some acquisitions that have not gone very well. So if you are fearful I think you're going to look at that each week. Deploy this cash because shareholders. Are knocking at my door thing I have too much cash quick and I do it's likely -- raised dividends which I still think will happen. Even though the dividend rate has moved up but not as much as we thought. And buybacks would be a very very useful and simple way of getting back cash off the balance sheet and in some cases. Helping out shareholders. Already well Peter thank you again for October and all of us this morning and we appreciate the info as always a all right that was Peter Anderson. From congress asset management coming up we are going to be joined. By Jason -- -- from the Motley Fool talking about some of his stock picks for 2013. That's next right here on the financial exchange.