With the fiscal cliff approaching, there appears to be 2 possibilities to think about.
1. No agreement is reached and we lose the Bush era tax cuts.
2. An agreement is reached that involves tax hikes and/or government spending cuts.
Both options have negative consequences for the stock market. In a downward headed market, generally we want to keep cash on hand and use covered calls on stocks we wouldn't mind selling anyway. Even in a major pullback, absolutely do not sell core dividend paying blue chips-ride it out. The tax consequences are not known yet but on small portfolios < 100k it won't make a huge difference. Stocks to watch-LINE, LNCO, GLW, F, COP, PSX, CVX, INTC, ARNA.
About Me
- jc
- Interested in saving and investing for financial freedom. Mid to late career IT worker with 20+ years in the state retirement system seeking alternate income through dividend growth investments. Final goal is to pass it down to my children and that they do the same for their children-a continuing generational wealth transfer.
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