Perma-Bull Larry Kudlow Says Sell?
Perma-bull, pom-pom carrying CNBC personality Larry Kudlow is rarely the person telling us to sell stocks, but this is exactly what he’s telling us in a recent article. His article for the most part, focuses on selling prior to the increase in capital gains taxes scheduled for January 1, 2011.
Taxes are going up across-the-board. So investors should seriously consider selling into any stock market strength ahead of the tax deadline. Doing this will enable investors to lock in a lower capital-gains tax this year and beat next year’s higher rates.It’s a lesson investors literally cannot afford to forget: If after-tax investment returns decline, because the key capital-gains tax rate and other investment taxes go up, the future value of stocks is damaged.
This may apply to you depending on your portfolio or your strategy. For me, most of my holdings are inside a Roth IRA where capital gains taxes don’t apply.
Also, Kudlow does comment on the economy briefly:
The question must be asked: Are we setting up right now for a second-half slowdown? Not a double-dip recession necessarily, but some sluggishness and inertia in the V-shaped recovery?
Just the fact that Kudlow is even asking the question is pretty interesting. Usually, he spins everything as a positive as he cheers on the journey to Dow 50,000.