Dow May be Derailed by Protectionism, Immigration
Stocks came off session lows Thursday morning, following Federal Reserve Chairman Ben Bernanke’s reassuring words on subprime lending. Richard Sichel, chief investment officer at Philadelphia Trust Company, and Jack Ablin, chief investment officer at Harris Private Bank, joined CNBC’s Liz Claman on “Morning Call” to discuss what, if anything, could disrupt the Dow’s momentum now.
“The economy is strong, corporate earnings are terrific,” said Sichel. He mentioned that while gasoline prices are rising, consumers continue to spend money. “High gasoline prices effect businesses like Wal-Mart and effect certain areas of the economy, but employment remains strong and wages are relatively strong, so the consumer is still in good shape,” said Sichel.
Ablin told Claman that the biggest risks he sees right now are not financial, but political.
“If you consider that this flow of funds that we’ve enjoyed from many of our trading partners are demographically driven, what is going to upset this could be protectionism, underwriting standards for lenders and maybe even an immigration policy,” said Ablin.
He added, “with an election year around the corner, the risks are getting closer and closer.”