Is it Time to Invest in US Blue Chip Stocks?

With the European Union (EU) about to begin an unprecedented quantitative easing program (QE) that could see a flight of capital out of the EU, along with sovereign bonds being weak, it might be a good time to look into US blue chip, large cap American stocks.

Who wants to buy European sovereign bonds at a negative yield? Sure way to lose money. You might not lose a lot of money but you will lose some. Why run that risk? Who likes losing money? Looking at the ten year plan, money will be going into US large cap equities. Why not go there now? There are also some good deals with cybersecurity companies like Palo Alto Networks (PNW: Nasdaq).

Investors should be cautious right now. US Markets are a bit pricey with the Dow Jones Industrial Average (DJIA) above 17,895. Right now European stocks are more reasonably priced and there are some good emerging market equities out there. However, over the next decade, thinking long term, one can make money in the US equities market.

There is Safety in Large-Cap US Companies

If another disaster like the 2009 global recession comes, where does one hide? US blue chip stocks. You will lose some money but not like you will lose should you be holding sovereign bonds. There are good reasons to be worried with China slowing, Europe mired in deflation and economic stagnation. US data floundering a bit does not help. However, when the hit does come it is safe to say richly priced fixed income stocks will take a bigger hit than blue chip stocks like General Electric (GE: NYSE).

Food for thought, there are macroeconomic problems out there but not everything is gloomy. There are times to look at safety and there is, usually, nothing safer than blue chip US companies. Especially when looking at the long-term.