What the Fiscal Cliff Deal Means for Investing in 2013

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Stock markets surged on the first day of trading following the scaled-down fiscal cliff deal, but if there was ever a "Band-Aid" fix, this is it.

That's because the deal failed to address three key financial problems.

The debt ceiling, the automatic spending cuts, and an expired budget are all still issues that need to be resolved within the next couple months. If not, the United States will head into a recession in 2013.

Money Morning Chief Investment Strategist Keith Fitz-Gerald appeared on CNBC Asia Tuesday to discuss these enormous failures in the fiscal cliff deal.

"Instead of working diligently for the past year on a meaningful overhaul to our taxes and a serious fix to entitlement programs, our leaders dithered, bickered and postured until the last minute," Fitz- Gerald said. "I think it's very irresponsible and an abuse of the public trust."

Fitz-Gerald explained what this rushed deal means for investing in 2013.

Fitz-Gerald warned that individual investors shouldn't do anything rash, but instead stick to their established investing strategies.

In addition to outlining the stocks and sectors that could perform well in 2013, Fitz-Gerald said there's one foreign market to be invested in if you aren't already.

Watch the entire accompanying video to see Fitz-Gerald's 2013 forecast for the Standard & Poor's 500 Index, and some good places for investing in 2013.

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  1. Geoffrey Boynton | January 7, 2013

    All the talk of improving economy is embarrassing. The guardian of the medium of exchange is dedicated to the destruction of its value. The government is spending seven million dollars every minute and barrows about 40% of that amount. The very economic architecture of the country has been horribly damaged. Four more years of accelerated spending is not sustainable. And we are told that out of fairness the government needs to tax more. The level of economic ignorance is breathtaking. Those in power do not consider deeply the consequences of their actions. The American economy is 70% driven by consumption; savings is no longer considered important or a significant activity. Entitlements have become the principal political activity and government has become the looming third party risk of the country.

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