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Tim Ghriskey, CIO, Solaris Asset Management explains to CNBC-TV18 that the threat of the fiscal cliff has been reduced to an issue of time. Ghriskey also adds that the Fed’s announcement, though a bit unexpected, would kick-start the cessation of the easing environment enjoyed by the Fed for sometime now.
Tim Ghriskey, CIO, Solaris Asset Management explains to CNBC-TV18 that the threat of the fiscal cliff has been reduced to an issue of time. Ghriskey also adds that the Fed's announcement, though a bit unexpected, would kick-start the cessation of the easing environment enjoyed by the Fed for sometime now.
Below is an edited transcript of the analysis on CNBC-TV18
Q:What do you make of markets reacting not so enthusiastically to what we heard from the Fed?
A: The Fed's announcement was unexpected certainly, although it had been telegraphed for somewhile that the Fed was looking at more precise targets, in terms of what would cause a cessation of the easing environment that the Fed has enjoyed for several years.
So we think this actually provides a nice level of clarity to the Fed. The date of mid-2015 that the Fed had used previously, I am not sure anybody really understood it or believed at. So we think this is certainly a positive.
There has been a bit of profit-taking in the market today and a very nice run in stocks despite the overhang of the fiscal cliff. And our belief is not whether the deal will get done, it is just simply when it will get done and we see it as becoming a gradual hill and not a cliff at all.
Q:In which case, you don't expect markets to decline much further from the levels that we have currently seen over the last week because you are saying a resolution will be found in time?
A: In time, I am not sure. We certainly could see a resolution in the New Year. Politicians like to be able to brag that they have decreased taxes. So if the cliff does occur, which it certainly might, and then Congress finally acts and comes up with a more gradual plan for dealing with the debt situation, we think Congress can say 'Gee, we decreased taxes' and Congressmen loves to say that when they are out there running for re-election as they have to do every two years in the House.
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