2 Plays That Avoid the Fiscal Cliff


Rudy Martin Image Rudy Martin Editor, Investing Insight

Usually the end of the year guarantees a big rally, as funds buy and sell to get the bonus money pool up to pay for traders' Christmas bills, but this year, the fiscal cliff has meant sober markets...for now, notes Rudy Martin in Latin Stock Investing.

Will it be a just-in-time Christmas present, an event to toast on New Year’s Eve, a better-late-than-ever compromise in early 2013—or just a “might have been?”

Those are some recent rumors circulating among investors about the possible resolution to the US “fiscal cliff” dilemma. Less is being heard about any conclusive solution to Europe’s financial woes. And while a new regime is in place in China, nothing has been heard about economic initiates to propel that nation’s economy.

Because of the world-wide epidemic of political, financial, and economic uncertainty, the makeup of the Latin Stock Investing Model Stock Portfolios has been on hold in recent weeks.

“The World is Flat,” as Thomas L. Friedman stressed in the title of his book by that name—and in export-dependent Latin America, events in nations that consume its minerals and agricultural output and other products heavily impact the region’s economy.

While waiting for some indication of improvement of the economies of the United States, Europe, and Asia, the LSI Model Growth Stock Portfolio is largely insulated from the stock market’s uncertainty and volatility with a 48.2% position in the relatively stable fixed-income iShares JPMorgan $ Emerging Market Bond Fund ETF (EMB).

As far as stocks, a sensible investment in the current foggy climate would be a relatively stable consumer stock.