Deal or no deal? Deal, predicts strategist

Valliere sees Washington steering clear of the fiscal cliff; say goodbye to low cap gains rates, though

Nov 14, 2012 @ 7:40 am

By Dan Jamieson

Fiscal cliff
+ Zoom
((Photo: Bloomberg News))

Look for a budget deal sometime in December, said Greg Valliere, chief political strategist at the Potomoc Research Group during the opening session at the Schwab Impact conference in Chicago Tuesday.

House speaker John Boehner “is smart enough to realize that the last thing he needs is to be the party of obstructionists, or the party that lets taxes go up January 1,” he said.

And president Obama “does not want to start his second term in an economic crisis” by going over the fiscal cliff, he said.

“The final reason I think we get a deal in December is that corporate America, almost to a person, has descended on [Washington] saying it's unthinkable if we don't get a deal,” Mr. Valliere said. This lobbying “has had an impact, especially among Republicans.”

But any idea that we're about to see a big [political] breakthrough …that will break the logjam in Washington is naïve,” he said.

“Sadly, the markets are going to have to get angry” before lawmakers act, Mr. Valliere said. “That is the missing catalyst. … The next seven weeks are potentially quite volatile.”

Mr. Valliere told advisers at the conference that their clients may never again see capital gains taxes as low as current rates. And he doesn't see much chance for the municipal bond tax exemption to be eliminated.

The muni tax break “is like motherhood and apple pie,” he said, and would hit state and local governments when they're down.

“My gut feeling is [the exemption] is probably going to be spared,” he added, “but I'm not [as] certain” as in past periods when the exemption has been attacked.

0
Comments

What do you think?

View comments

Recommended for you

Featured video

Events

Dynasty's Penney: How to stay ahead of the curve

With rapid evolution, financial advisers stand at a unique crossroads. Dynasty's Shirl Penney offers some simple strategies to remain a step ahead of the competition.

Video Spotlight

Will It Last As Long As Your Clients Do?

Sponsored by Prudential

Video Spotlight

The Catalyst

Sponsored by Pershing

Latest news & opinion

Nationwide's 401(k) record-keeping fees are excessive, lawsuit claims

Plaintiffs claim practice of charging plans a percentage of assets is unreasonable.

Wealth management firms struggle with lower fees, fewer new clients

Advisers in North America earned less from clients last year and saw a decline in average fees, according to a new report by PriceMetrix.

These investors are allowed to put $500K into a Roth IRA at once

The HEART Act permits rolling all or part of life-insurance and combat-related-fatality payouts directly into the tax-free retirement plan, but few take advantage.

Labor's Alexander Acosta and SEC's Jay Clayton tell lawmakers they will work together on fiduciary rule

In separate appearances before Senate panels, the regulators stressed the cooperation that Republican legislators and opponents of the DOL fiduciary rule are demanding.

Brian Block denies cooking the books at Schorsch REIT

Former CFO claims everything he did was 'appropriate' and 'correct.'

X

Subscribe and Save 60%

Premium Access
Print + Digital

Learn more
Subscribe to Print