Be 'Very Cautious'—Lot of Downside Risk Ahead: Pro
CNBC.com Writer
Is a political gridlock good for stocks? Ron Carson, chief executive and founder of Carson Wealth Management Group, and Adam Bold, CEO and founder of The Mutual Fund Store, shared their views.
“Gridlock in the past has been good because things were fundamentally okay, but [now,] things are broken,” Carson told CNBC.
Carson said the current economy needs “decisive leadership and action,” which is unattainable through gridlock.
“There are huge negatives...so I would be very cautious,” he warned. “There’s only a little upside in the market—we could go up 8 or 10 percent, but there’s a lot of downside and I think investors need to be prepared.”
Carson said goldis a good place for investors to put their money in addition to some MLPs* and preferred stocks.
Bold's Counterpoint:
Meanwhile, Bold said investors should stop focusing on the “little negatives.”
“This country has the ability to persevere through a lot of terrible things and we have a lot to look forward to going forward,” he said.
“We have revenue going up with reduced cost structures and companies are going to make money more than they’ve ever made before."
"That’s going to lead stock prices higher.”
*MLPs: Master Limited Partnerships, publicly traded on a securities exchange. Typically, they combine the tax benefits of a limited partnership with the liquidity of publicly traded securities.
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Scorecard—What They Said:
- Bold's Previous Appearance on CNBC (Sept. 23, 2010)
- Carson's Previous Appearance on CNBC (Oct. 27, 2010)
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More Market Intelligence:
- After the Fed and Election: What's Next for Wall Street?
- Cramer: The Only 2 Ways to Play Tuesday’s Midterms
- Markets Will Continue to March Higher: Stock Pickers
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Major Earnings Coming Up:
Electronic Arts
Aetna
Kraft Foods
Activision Blizzard
Berkshire Hathaway
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Disclosures:
No immediate information was available for Bold or Carson.
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