We are relatively constructive about markets generally in light of modest valuations, accommodating monetary policy and economic data which suggest growth from the pre-
crisis lows. However, against this backdrop remain numerous issues that weigh on sentiment, creating opportunities for investors, but presenting real risks to robust economic recovery. Among the issues we track that have the potential to create market dislocations are:
• US government deficits at the municipal, state and federal levels, including entitlement liabilities, and their impact on inflation, interest rates, and growth
• Unwise US regulatory intervention
• European sovereign default risk weighing on the Euro
• Middle Eastern defaults
• Japanese fiscal/demographic crisis
• Chinese economic growth, credit quality and currency volatility
• “Peak Oil” impact on geopolitical stability and economic welfare
• Climate change
crisis lows. However, against this backdrop remain numerous issues that weigh on sentiment, creating opportunities for investors, but presenting real risks to robust economic recovery. Among the issues we track that have the potential to create market dislocations are:
• US government deficits at the municipal, state and federal levels, including entitlement liabilities, and their impact on inflation, interest rates, and growth
• Unwise US regulatory intervention
• European sovereign default risk weighing on the Euro
• Middle Eastern defaults
• Japanese fiscal/demographic crisis
• Chinese economic growth, credit quality and currency volatility
• “Peak Oil” impact on geopolitical stability and economic welfare
• Climate change
