Wharton Professor and Stocks for the Long Run author Jeremy Siegel says he expects debt-laden European countries like Spain, Greece, and Portugal to stay in recession “for years to come”, but thinks stocks will still be much higher by the end of next year. Siegel tells CNBC that hopefully lower euro valuations will help those European countries, but thinks they may at some point have to drop out of the eurozone. But, he says he thinks the U.S.’s “fiscal cliff” problem will be resolved “to people’s surprise” by next year, spurring stocks higher by the end of 2013. If Congress can get together and extend set-to-expire tax cuts by the end of this year, he says it will add 1,000 points to the Dow Jones Industrial Average, “easy”, by year-end. If they kick the problem ahead to next year, however, stocks will likely end the year not much higher than current levels, “at best”.
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