David Fleer
Bristlecone Value Partners, LLC
12301 Wilshire Blvd., Suite 320
Los Angeles, CA 90025 USA
Work 1-877-806-4141

Quarterly Commentary – 4th Quarter 2012

January 30th, 2013

During the fourth quarter, the drama over the so-called “Fiscal Cliff” came down to the wire, but with a less-than-satisfying conclusion.  In the end, the bill which finally passed a lame-duck Congress on New Year’s Day had all of the hallmarks of partisan gridlock that we’ve come to expect: each side gave ground on issues which they had previously claimed were “non-negotiable”, neither side was happy with the results, no “grand bargain” was reached, and instead of averting the fiscal cliff, legislators merely postponed the day of reckoning.

As part of the deal, the automatic spending cuts (“sequester”) which were scheduled to take effect on Jan 1st were postponed for another two months.  As you might recall, the sequester was originally proposed during the last debt ceiling debate in the summer of 2011.  The logic behind it at the time was that, faced with the threat of draconian tax increases and spending cuts (which neither party wanted) lawmakers would have an incentive to forge a more reasonable long-term agreement. Eighteen months later, it is clear that such a threat is just barely sufficient to keep political opponents in the same room together.  Perhaps not coincidentally, the new sequester deadline is scheduled to arrive at around the same time that the Treasury Department expects to hit the currently authorized debt ceiling, setting the stage for another fiscal dogfight (and likely market volatility) just around the corner.

Read the full commentary.

powered by  Advisor Designs - Web Designers for Financial Advisors