Roubini: The Longer-Term Picture Is Bleaker And The Next Crisis Could Be Just Two Months Away. The “Mini Deal” On The Fiscal Cliff Dodged All The Important Questions.

Thursday, January 3, 2013
By Paul Martin

Investmentwatchblog.com
January 2nd, 2013

Experts: Stock Market Relief Over Fiscal Cliff Deal Will Be Brief. First Quarter Is Going To Be Choppy

The stock market bounce following the deal avoiding the fiscal cliff will probably be brief, as financial markets face a rough two months ahead, experts told CNBC.

Congress begins its true test when it starts talks over increasing the government’s debt ceiling. And the stakes are even higher. Failure to raise the limit would mean government default.

“This will plague us at least until the end of the first quarter because we have got these discussions about raising the debt ceiling, which will lump all negotiations — expenditure, tax hikes — into one,” Andrew Economos of JPMorgan Asset Management told CNBC.

“So the first quarter is going to be choppy.”

Martin Lakos, division director of Macquarie Private Wealth in Sydney, Australia, agrees.

“I think the problem for markets going forward is the fact that we are really not addressing the debt ceiling issue until the 28 February deadline,” he told CNBC. “So unfortunately, we are going to get a couple of months of volatility.”

The Rest…HERE

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