For investors, the rest of 2015 may not look like January. Robert Doll of Nuveen Asset Management believes the same factors that made January a rough month for equities will support longer-term economic growth. The threat of rising interest rates in 2015 is partly due to a change of voting members in the Federal Open Market Committee. But is the threat really serious? Scott Eldridge looks into the variables, and why it’s especially important now to have a diversified maturity structure. “America is back” is the consensus of the 2015 meeting of global movers, shakers, and opinion shapers in Davos, Switzerland. Peter Coy of Business Week explains why the U.S. is now the brightest light on the economic horizon.
Why The Rest Of 2015 May Not Look Like January– Robert Doll of Nuveen Asset Management believes the current weakness in equities will pass, but probably not until commodity prices stabilize and the associated deflation fears ease. The fundamental strength of the economy— along with the combination of benefits that can come from lower oil prices and a stronger dollar– should push equity prices higher this year. Market volatility is likely to persist, but he believes equities should outperform cash, bonds, commodities and inflation in 2015. Read more…
Contrarian View: A More Balanced Approach to Rate Risk in 2015– Scott Eldridge of Invesco believes the January 2015 changes to the membership of the Federal Reserve will bring about an even more dovish weighting to voting. This is based on historical voting patterns and public comments made by members. If the Federal Reserve takes a slower, steadier approach to tightening than anticipated, fixed investments with longer average durations may not be the portfolio-killers they would be in an environment where the interest rate rises more rapidly. Read more…
America The Relatively Beautiful– The global elites who congregate each year in Davos, Switzerland, are hardly representative of humanity. However, you can still learn a lot at the annual conclave about who’s up and who’s down in the world. One of the biggest take-aways of the 2015 meeting was this: America is back. “When you look around the globe, it’s just very hard to find a lot of big, bright lights on the economic horizon” except for the “amazing” U.S., says Michael Sabia. BusinessWeek covers the story. Read more…
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John R. Day, Bill Ennis, Stephanie Davidson and Matt Heller