It is our contention at Hennion & Walsh that the market has essentially priced in the belief that an agreement on raising the current debt ceiling will happen. It is just now a question of when the agreement will be finalized and what the length and terms of the finalized agreement will be. Unfortunately, the finalization of the agreement may not be enough to avert further consideration of a downgrade to the U.S. AAA credit rating by the rating agencies. Regardless, after this current debt crisis is behind us, investors, in our opinion, will return their focus to a stalling economic recovery that is facing multiple headwinds. These headwinds include a stubbornly high unemployment rate, a disturbing trend of increasing jobless claims, elevated commodity prices, a lackluster residential real estate and increasing sovereign debt problems overseas and, as previously discussed, on our homeland.Read more
Forget the Debt Ceiling Debate… Where’s the Economic Growth?
Published: Jul. 29, 2011