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If investors are worried about the threat from the fiscal cliff, it's not obvious in the recent price trends for the major asset classes. Our ETF proxies for the primary slices of the world's capital and commodity markets remain in the black for the year through November 23. For the month so far, only foreign developed-market bonds and REITs are suffering from the red ink disease, albeit in moderate doses, while the U.S. stock market overall is near the tipping point.

It's a strange, almost surreal environment. Depending on the analyst, the forecast if the fiscal cliff's tax hikes and spending cuts are allowed to kick in come January ranges from a minor blip to deep economic recession. There are also those who dismiss the danger entirely, arguing that it's a media-hyped event for the political class, with little or no real consequence for the economy or markets. Given the generally positive returns across the major asset classes, one might wonder if the crowd leans toward the latter view. December's market action, no doubt, will sort it all out. Meanwhile, here's how the horse race stacks up so far:

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US STOCKS • Vanguard Total Market (VTI) • Benchmark: MSCI US Broad Market Index

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FOREIGN DEVELOPED MARKET STOCKS • Vanguard Europe Pacific (VEA) • Benchmark: MSCI EAFE

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EMERGING MARKET STOCKS • Vanguard Emerging Markets (VWO) • Benchmark: MSCI Emerging Market

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US BONDS • Vanguard Total Bond Market (BND) • Benchmark: Barclays US Aggregate

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INFLATION-INDEXED US TREASURIES • iShares Barclays TIPS Bond (TIP) • Benchmark: Barclays US TIPS

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HIGH YIELD BONDS • SPDR Barclays High Yield Bond (JNK) • Benchmark: Barclays High Yield Very Liquid

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COMMODITIES • iPath Dow Jones-UBS Commodity (DJP) • Benchmark: DJ-UBS Commodity

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REAL ESTATE INVESTMENT TRUSTS • Vanguard REIT (VNQ) • Benchmark: MSCI US REIT

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FOREIGN DEVELOPED MARKET GOVERNMENT BONDS • SPDR Barclays Int'l Treasury (BWX) •
Benchmark: Barclays Global Treasury ex-US Capped

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EMERGING MARKET GOVERNMENT BONDS • Van Eck Market Vectors Emg Mkt Local Currency Bond (EMLC) • Benchmark: J.P. Morgan GBI-EMG Core

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FOREIGN GOVERNMENT INFLATION-LINKED BONDS • SPDR DB International Inflation-Protected Bond (WIP) • Benchmark: DB Global Government ex-US Inflation-Linked Bond Capped

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FOREIGN CORPORATE BONDS • PowerShares International Corporate Bond (PICB) • Benchmark: S&P International Corporate Bond

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Charts courtesy of StockCharts.com

Source: Tactical ETF Review: 11.26.2012