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- Turkey is a critical country for the modern world as it had been a successful story of combining the best of the Western world with the Middle East. The current turmoil is distressing.
- The Turkish stock market is down 18% in a month, but O'Neill isn't sure it is a table-pounding buy because the market had risen quite significantly in the two years prior, so a correction may be reasonable. He urges caution on investing in Turkey.
- If U.S. rates start rising because of the Fed tapering countries with significant current account deficits are going to vulnerable.
- He suggests looking back on 1994 which was the last true bear market in bonds for an idea of what happens when bond yields start rising.
- We need to prepare ourselves for U.S. bond yields being at 4%, not 2%.
- We are likely at the end of a 30-year bull market in bonds and about to return to an equity culture.
- The stock markets with the most attractive valuations are the periphery countries in Europe as well as China and India.