Two Ways You Can Profit from the Fiscal Cliff
We can't control the arguments in Washington, but we can control our money. That means it's time to learn how to profit from the fiscal cliff. If the U.S. economy "falls off" the fiscal cliff, stocks will plunge even more, as the Dow Jones Industrial Average is down about 500 points since the Nov. 6 election, the lowest level in over four months. "It's not hard to make the case we are headed for a recession," warned Hugh Johnson, head of Hugh Johnson Advisors, a financial and economic advising firm. In addition to stocks, the U.S. dollar value will plummet as well. Fitch Ratings has already threatened to downgrade the United States if substantial progress is not made on addressing its economic woes, starting with the fiscal cliff. That is not an idle threat as Standard & Poor's did reduce the credit rating of the United States in August 2011. But, there will also be tremendous investing opportunities. Here are two of the best ways to profit from falling off the fiscal cliff . To continue reading, please click here...
We can't control the arguments in Washington, but we can control our money. That means it's time to learn how to profit from the fiscal cliff.
If the U.S. economy "falls off" the fiscal cliff, stocks will plunge even more, as the Dow Jones Industrial Average is down about 500 points since the Nov. 6 election, the lowest level in over four months.
"It's not hard to make the case we are headed for a recession," warned Hugh Johnson, head of Hugh Johnson Advisors, a financial and economic advising firm.
In addition to stocks, the U.S. dollar value will plummet as well.
Fitch Ratings has already threatened to downgrade the United States if substantial progress is not made on addressing its economic woes, starting with the fiscal cliff. That is not an idle threat as Standard & Poor's did reduce the credit rating of the United States in August 2011.
But, there will also be tremendous investing opportunities. Here are two of the best ways to profit from falling off the fiscal cliff.
Profit from the Fiscal Cliff First, investors should consider gold and gold-related investments. Gold will soar as a result of the fiscal cliff.
Companies in the sector that pay a dividend such as Barrick Gold Corp. (NYSE: ABX), Gold Fields Ltd. (NYSE ADR: GFI) and Newmont Mining Corp. (NYSE: NEM) should do very well.
Barrick Gold pays a dividend of 2.36%. For Gold Fields, the income stream flows at a 4.18% rate. Newmont Mining pays its shareholders a dividend of 3.06%.
Investors: Want to know more about buying gold? Check out this special report. body #pp-popup-50aa716e62914 div,body #pp-popup-50aa716e62914 dl,body #pp-popup-50aa716e62914 dt,body #pp-popup-50aa716e62914 dd,body #pp-popup-50aa716e62914 ul,body #pp-popup-50aa716e62914 ol,body #pp-popup-50aa716e62914 li,body #pp-popup-50aa716e62914 h1,body #pp-popup-50aa716e62914 h2,body #pp-popup-50aa716e62914 h3,body #pp-popup-50aa716e62914 h4,body #pp-popup-50aa716e62914 h5,body #pp-popup-50aa716e62914 h6,body #pp-popup-50aa716e62914 pre,body #pp-popup-50aa716e62914 code,body #pp-popup-50aa716e62914 form,body #pp-popup-50aa716e62914 fieldset,body #pp-popup-50aa716e62914 legend,body #pp-popup-50aa716e62914 input,body #pp-popup-50aa716e62914 textarea,body #pp-popup-50aa716e62914 p,body #pp-popup-50aa716e62914 blockquote,body #pp-popup-50aa716e62914 th,body #pp-popup-50aa716e62914 td{margin:0;padding:0;line-height:normal;}body #pp-popup-50aa716e62914 table{border-collapse:collapse;border-spacing:0;}body #pp-popup-50aa716e62914 fieldset,body #pp-popup-50aa716e62914 img{border:0;}body #pp-popup-50aa716e62914 address,body #pp-popup-50aa716e62914 caption,body #pp-popup-50aa716e62914 cite,body #pp-popup-50aa716e62914 code,body #pp-popup-50aa716e62914 dfn,body #pp-popup-50aa716e62914 em,body #pp-popup-50aa716e62914 strong,body #pp-popup-50aa716e62914 th,body #pp-popup-50aa716e62914 var{font-style:normal;font-weight:normal;}body #pp-popup-50aa716e62914 li{list-style:none;}body #pp-popup-50aa716e62914 caption,body #pp-popup-50aa716e62914 th{text-align:left;}body #pp-popup-50aa716e62914 h1,body #pp-popup-50aa716e62914 h2,body #pp-popup-50aa716e62914 h3,body #pp-popup-50aa716e62914 h4,body #pp-popup-50aa716e62914 h5,body #pp-popup-50aa716e62914 h6{font-size:100%;font-weight:normal;}body #pp-popup-50aa716e62914 q:before,body #pp-popup-50aa716e62914 q:after{content:'';}body #pp-popup-50aa716e62914 abbr,body #pp-popup-50aa716e62914 acronym{border:0;font-variant:normal;}body #pp-popup-50aa716e62914 sup{vertical-align:text-top;}body #pp-popup-50aa716e62914 sub{vertical-align:text-bottom;}body #pp-popup-50aa716e62914 input,body #pp-popup-50aa716e62914 textarea,body #pp-popup-50aa716e62914 select{font-family:inherit;font-size:inherit;font-weight:inherit;}body #pp-popup-50aa716e62914 input,body #pp-popup-50aa716e62914 textarea,body #pp-popup-50aa716e62914 select{*font-size:100%;}body #pp-popup-50aa716e62914 legend{color:#000;}body #pp-popup-50aa716e62914 del,body #pp-popup-50aa716e62914 ins{text-decoration:none;} body #pp-popup-50aa716e62914 h1{font-size:138.5%;}body #pp-popup-50aa716e62914 h2{font-size:123.1%;}body #pp-popup-50aa716e62914 h3{font-size:108%;}body #pp-popup-50aa716e62914 h1,body #pp-popup-50aa716e62914 h2,body #pp-popup-50aa716e62914 h3{margin:1em 0;}body #pp-popup-50aa716e62914 h1,body #pp-popup-50aa716e62914 h2,body #pp-popup-50aa716e62914 h3,body #pp-popup-50aa716e62914 h4,body #pp-popup-50aa716e62914 h5,body #pp-popup-50aa716e62914 h6,body #pp-popup-50aa716e62914 strong{font-weight:bold;}body #pp-popup-50aa716e62914 abbr,body #pp-popup-50aa716e62914 acronym{border-bottom:1px dotted #000;cursor:help;}body #pp-popup-50aa716e62914 em{font-style:italic;}body #pp-popup-50aa716e62914 del{text-decoration:line-through;}body #pp-popup-50aa716e62914 blockquote,body #pp-popup-50aa716e62914 ul,ol,body #pp-popup-50aa716e62914 dl{margin:1em;}body #pp-popup-50aa716e62914 ol,body #pp-popup-50aa716e62914 ul,dl{margin-left:2em;}body #pp-popup-50aa716e62914 ol li{list-style:decimal outside;}body #pp-popup-50aa716e62914 ul li{list-style:disc outside;}body #pp-popup-50aa716e62914 dl dd{margin-left:1em;}body #pp-popup-50aa716e62914 th,body #pp-popup-50aa716e62914 td{border:1px solid #000;padding:.5em;}body #pp-popup-50aa716e62914 th{font-weight:bold;text-align:center;}body #pp-popup-50aa716e62914 caption{margin-bottom:.5em;text-align:center;}p,body #pp-popup-50aa716e62914 fieldset,table,body #pp-popup-50aa716e62914 pre{margin-bottom:1em;}body #pp-popup-50aa716e62914 input[type=text],body #pp-popup-50aa716e62914 input[type=password],body #pp-popup-50aa716e62914 textarea{width:12.25em;*width:11.9em;} jPPUI('#pp-link-50aa716e62914').data('options', {"ID":"70925","options":{"width":"480","height":"280","shadow":false,"background":"#ffffff","noTitle":true,"frameColor":"#aaaaaa","frameSize":0,"borderRadius":"0","closeOnEscape":false,"closeOnOuterClick":false,"closeBtnX":true,"affiliate":false,"modal":true,"overlay":true,"overlayColor":"#2f2727","overlayTransparency":50,"sticky":true,"webroot":"http:\/\/moneymorning.com\/wp-content\/plugins\/platinumpopup","draggable":false,"frameStyle":"solid","closeOnMouseLeave":false,"ID":"50aa716e62914"},"title":"Gated Content Popups (one liners)","content":"<div id=\"ppopup-50aa716e62914\" class=\"ppopup\"><div class=\"widget cfox_preload\"><div class=\"cfox_preload_widget\"><\/div><\/div><\/div>"});
The fiscal cliff will also make oil a profitable long-term buy.
Unlike gold, which is mostly an investment vehicle, oil is utilized for industrial purposes.
Overall, oil stocks are down due to declining economic growth around the world. If the fiscal cliff is crossed, these stocks could drop further.
This will be an ideal time for long-term investors to pay lower prices for oil companies with high dividends.
Like the dividend-paying gold stocks, oil companies are positioned well to profit from the growth in emerging market nations.
Over the last month, Big Oil stocks have fallen.Exxon Mobil Corp. (NYSE: XOM) is down 5% and Chevron Corp. (NYSE: CVX) is off by 9%.For the same period, Occidental Petroleum (NYSE: OXY) has plunged about 10%.
That fall has served to make them more attractive, jacking up the dividend yield of each.
At present, ExxonMobil has a dividend yield of 2.65%, Chevron offers 3.5%, and Occidental 2.92%. In addition, oil companies have a history of increasing the dividend. That makes stocks in the oil industry even more attractive as long-term holdings.
Robert Scherer of Graystone Consulting offered this about long-term investments and the fiscal cliff: "It's like trying to focus on driving, but looking two feet ahead of you instead of way ahead of you."
Even if Congress and the White House do work out a deal to avert the fiscal cliff, oil and gold stocks are good "Buys" already due to stock prices falling in anticipation of an unhappy ending.
This is how investors who want to prepare, not worry, can profit from the fiscal cliff.
For another look at how next year's economy is headed for a recession regardless of the fiscal cliff action, check out today's analysis by Money Morning Global Investing Strategist Martin Hutchinson.
Related Articles and News:
Tags: avoid fiscal cliff effects, fiscal cliff, fiscal cliff 2013, fiscal cliff bargaining, fiscal cliff deal 2013, fiscal cliff definition, fiscal cliff impact on gdp, fiscal cliff sequestration, fiscal cliff stocks to buy, how to stop the fiscal cliff, how will fiscal cliff effect gold, how will fiscal cliff effect stocks and bonds, how will the fiscal cliff affect me, how will the fiscal cliff effect my investments, how will the fiscal cliff impact europe, investing for the fiscal cliff, profit from the fiscal cliff, the fiscal cliff 2013, ways to profit from the fiscal cliff, what caused the fiscal cliff, what is the fiscal cliff, when do we hit fiscal cliff, when is fiscal cliff
"It's not hard to make the case we are headed for a recession," warned Hugh Johnson, head of Hugh Johnson Advisors, a financial and economic advising firm.
In addition to stocks, the U.S. dollar value will plummet as well.
Fitch Ratings has already threatened to downgrade the United States if substantial progress is not made on addressing its economic woes, starting with the fiscal cliff. That is not an idle threat as Standard & Poor's did reduce the credit rating of the United States in August 2011.
But, there will also be tremendous investing opportunities. Here are two of the best ways to profit from falling off the fiscal cliff.
Profit from the Fiscal Cliff First, investors should consider gold and gold-related investments. Gold will soar as a result of the fiscal cliff.
Companies in the sector that pay a dividend such as Barrick Gold Corp. (NYSE: ABX), Gold Fields Ltd. (NYSE ADR: GFI) and Newmont Mining Corp. (NYSE: NEM) should do very well.
Barrick Gold pays a dividend of 2.36%. For Gold Fields, the income stream flows at a 4.18% rate. Newmont Mining pays its shareholders a dividend of 3.06%.
Investors: Want to know more about buying gold? Check out this special report. body #pp-popup-50aa716e62914 div,body #pp-popup-50aa716e62914 dl,body #pp-popup-50aa716e62914 dt,body #pp-popup-50aa716e62914 dd,body #pp-popup-50aa716e62914 ul,body #pp-popup-50aa716e62914 ol,body #pp-popup-50aa716e62914 li,body #pp-popup-50aa716e62914 h1,body #pp-popup-50aa716e62914 h2,body #pp-popup-50aa716e62914 h3,body #pp-popup-50aa716e62914 h4,body #pp-popup-50aa716e62914 h5,body #pp-popup-50aa716e62914 h6,body #pp-popup-50aa716e62914 pre,body #pp-popup-50aa716e62914 code,body #pp-popup-50aa716e62914 form,body #pp-popup-50aa716e62914 fieldset,body #pp-popup-50aa716e62914 legend,body #pp-popup-50aa716e62914 input,body #pp-popup-50aa716e62914 textarea,body #pp-popup-50aa716e62914 p,body #pp-popup-50aa716e62914 blockquote,body #pp-popup-50aa716e62914 th,body #pp-popup-50aa716e62914 td{margin:0;padding:0;line-height:normal;}body #pp-popup-50aa716e62914 table{border-collapse:collapse;border-spacing:0;}body #pp-popup-50aa716e62914 fieldset,body #pp-popup-50aa716e62914 img{border:0;}body #pp-popup-50aa716e62914 address,body #pp-popup-50aa716e62914 caption,body #pp-popup-50aa716e62914 cite,body #pp-popup-50aa716e62914 code,body #pp-popup-50aa716e62914 dfn,body #pp-popup-50aa716e62914 em,body #pp-popup-50aa716e62914 strong,body #pp-popup-50aa716e62914 th,body #pp-popup-50aa716e62914 var{font-style:normal;font-weight:normal;}body #pp-popup-50aa716e62914 li{list-style:none;}body #pp-popup-50aa716e62914 caption,body #pp-popup-50aa716e62914 th{text-align:left;}body #pp-popup-50aa716e62914 h1,body #pp-popup-50aa716e62914 h2,body #pp-popup-50aa716e62914 h3,body #pp-popup-50aa716e62914 h4,body #pp-popup-50aa716e62914 h5,body #pp-popup-50aa716e62914 h6{font-size:100%;font-weight:normal;}body #pp-popup-50aa716e62914 q:before,body #pp-popup-50aa716e62914 q:after{content:'';}body #pp-popup-50aa716e62914 abbr,body #pp-popup-50aa716e62914 acronym{border:0;font-variant:normal;}body #pp-popup-50aa716e62914 sup{vertical-align:text-top;}body #pp-popup-50aa716e62914 sub{vertical-align:text-bottom;}body #pp-popup-50aa716e62914 input,body #pp-popup-50aa716e62914 textarea,body #pp-popup-50aa716e62914 select{font-family:inherit;font-size:inherit;font-weight:inherit;}body #pp-popup-50aa716e62914 input,body #pp-popup-50aa716e62914 textarea,body #pp-popup-50aa716e62914 select{*font-size:100%;}body #pp-popup-50aa716e62914 legend{color:#000;}body #pp-popup-50aa716e62914 del,body #pp-popup-50aa716e62914 ins{text-decoration:none;} body #pp-popup-50aa716e62914 h1{font-size:138.5%;}body #pp-popup-50aa716e62914 h2{font-size:123.1%;}body #pp-popup-50aa716e62914 h3{font-size:108%;}body #pp-popup-50aa716e62914 h1,body #pp-popup-50aa716e62914 h2,body #pp-popup-50aa716e62914 h3{margin:1em 0;}body #pp-popup-50aa716e62914 h1,body #pp-popup-50aa716e62914 h2,body #pp-popup-50aa716e62914 h3,body #pp-popup-50aa716e62914 h4,body #pp-popup-50aa716e62914 h5,body #pp-popup-50aa716e62914 h6,body #pp-popup-50aa716e62914 strong{font-weight:bold;}body #pp-popup-50aa716e62914 abbr,body #pp-popup-50aa716e62914 acronym{border-bottom:1px dotted #000;cursor:help;}body #pp-popup-50aa716e62914 em{font-style:italic;}body #pp-popup-50aa716e62914 del{text-decoration:line-through;}body #pp-popup-50aa716e62914 blockquote,body #pp-popup-50aa716e62914 ul,ol,body #pp-popup-50aa716e62914 dl{margin:1em;}body #pp-popup-50aa716e62914 ol,body #pp-popup-50aa716e62914 ul,dl{margin-left:2em;}body #pp-popup-50aa716e62914 ol li{list-style:decimal outside;}body #pp-popup-50aa716e62914 ul li{list-style:disc outside;}body #pp-popup-50aa716e62914 dl dd{margin-left:1em;}body #pp-popup-50aa716e62914 th,body #pp-popup-50aa716e62914 td{border:1px solid #000;padding:.5em;}body #pp-popup-50aa716e62914 th{font-weight:bold;text-align:center;}body #pp-popup-50aa716e62914 caption{margin-bottom:.5em;text-align:center;}p,body #pp-popup-50aa716e62914 fieldset,table,body #pp-popup-50aa716e62914 pre{margin-bottom:1em;}body #pp-popup-50aa716e62914 input[type=text],body #pp-popup-50aa716e62914 input[type=password],body #pp-popup-50aa716e62914 textarea{width:12.25em;*width:11.9em;} jPPUI('#pp-link-50aa716e62914').data('options', {"ID":"70925","options":{"width":"480","height":"280","shadow":false,"background":"#ffffff","noTitle":true,"frameColor":"#aaaaaa","frameSize":0,"borderRadius":"0","closeOnEscape":false,"closeOnOuterClick":false,"closeBtnX":true,"affiliate":false,"modal":true,"overlay":true,"overlayColor":"#2f2727","overlayTransparency":50,"sticky":true,"webroot":"http:\/\/moneymorning.com\/wp-content\/plugins\/platinumpopup","draggable":false,"frameStyle":"solid","closeOnMouseLeave":false,"ID":"50aa716e62914"},"title":"Gated Content Popups (one liners)","content":"<div id=\"ppopup-50aa716e62914\" class=\"ppopup\"><div class=\"widget cfox_preload\"><div class=\"cfox_preload_widget\"><\/div><\/div><\/div>"});
The fiscal cliff will also make oil a profitable long-term buy.
Unlike gold, which is mostly an investment vehicle, oil is utilized for industrial purposes.
Overall, oil stocks are down due to declining economic growth around the world. If the fiscal cliff is crossed, these stocks could drop further.
This will be an ideal time for long-term investors to pay lower prices for oil companies with high dividends.
Like the dividend-paying gold stocks, oil companies are positioned well to profit from the growth in emerging market nations.
Over the last month, Big Oil stocks have fallen.Exxon Mobil Corp. (NYSE: XOM) is down 5% and Chevron Corp. (NYSE: CVX) is off by 9%.For the same period, Occidental Petroleum (NYSE: OXY) has plunged about 10%.
That fall has served to make them more attractive, jacking up the dividend yield of each.
At present, ExxonMobil has a dividend yield of 2.65%, Chevron offers 3.5%, and Occidental 2.92%. In addition, oil companies have a history of increasing the dividend. That makes stocks in the oil industry even more attractive as long-term holdings.
Robert Scherer of Graystone Consulting offered this about long-term investments and the fiscal cliff: "It's like trying to focus on driving, but looking two feet ahead of you instead of way ahead of you."
Even if Congress and the White House do work out a deal to avert the fiscal cliff, oil and gold stocks are good "Buys" already due to stock prices falling in anticipation of an unhappy ending.
This is how investors who want to prepare, not worry, can profit from the fiscal cliff.
For another look at how next year's economy is headed for a recession regardless of the fiscal cliff action, check out today's analysis by Money Morning Global Investing Strategist Martin Hutchinson.
Related Articles and News:
- Money Morning:
Fiscal Cliff 2013: Pay Now or Pay Later - Money Morning:
Facing the Fiscal Cliff Solves 77% of the Deficit Problem in One Move - The Washington Times:
Investors cope with fear of falling off the "fiscal cliff' - USA Today:
Stocks at 4-month lows as fiscal cliff looms
Tags: avoid fiscal cliff effects, fiscal cliff, fiscal cliff 2013, fiscal cliff bargaining, fiscal cliff deal 2013, fiscal cliff definition, fiscal cliff impact on gdp, fiscal cliff sequestration, fiscal cliff stocks to buy, how to stop the fiscal cliff, how will fiscal cliff effect gold, how will fiscal cliff effect stocks and bonds, how will the fiscal cliff affect me, how will the fiscal cliff effect my investments, how will the fiscal cliff impact europe, investing for the fiscal cliff, profit from the fiscal cliff, the fiscal cliff 2013, ways to profit from the fiscal cliff, what caused the fiscal cliff, what is the fiscal cliff, when do we hit fiscal cliff, when is fiscal cliff