Post by realisedurgency on Jan 6, 2016 20:17:53 GMT 7
Some nice graphs and discussion. Click the pdf link to download.
advisors.vanguard.com/VGApp/iip/site/advisor/researchcommentary/article/IWE_EcoInvestOutlook?utm_content=sf17543440&utm_medium=spredfast&utm_source=twitter&utm_campaign=FAS&sf17543440=1
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■ Global growth will remain frustratingly fragile in 2016. Global trade and manufacturing
activity will likely struggle, and additional “growth scares” should be expected.
Nevertheless, Vanguard’s non-consensus view is that the world’s ongoing structural
deceleration is converging toward a more balanced growth equilibrium. This structural
convergence is not yet complete, given the need for debt deleveraging in China and
other emerging markets.
■ At full employment, the U.S. economy is unlikely to accelerate in 2016, yet is on course
to experience its longest expansion in nearly a century, underscoring our long-held view
of its resiliency. We believe that those who see an even weaker future of U.S. secular
stagnation are too pessimistic and overlook the benefits of an unlevered expansion.
■ As we have discussed in Vanguard’s past outlooks, policymakers are likely to continue
to face difficulties achieving 2% inflation over the medium term. As of December 2015,
however, some of the most pernicious long-term deflationary forces are beginning to
moderate cyclically for the first time since 2006.
■ We anticipate a “dovish tightening” cycle by the U.S. Federal Reserve, and we continue
to view the global low-rate environment as secular, not cyclical.
■ Although not bearish, Vanguard’s outlook for global stocks and bonds is the most
guarded since 2006, given the low-interest-rate and low-earnings-yield environment.
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advisors.vanguard.com/VGApp/iip/site/advisor/researchcommentary/article/IWE_EcoInvestOutlook?utm_content=sf17543440&utm_medium=spredfast&utm_source=twitter&utm_campaign=FAS&sf17543440=1
====
■ Global growth will remain frustratingly fragile in 2016. Global trade and manufacturing
activity will likely struggle, and additional “growth scares” should be expected.
Nevertheless, Vanguard’s non-consensus view is that the world’s ongoing structural
deceleration is converging toward a more balanced growth equilibrium. This structural
convergence is not yet complete, given the need for debt deleveraging in China and
other emerging markets.
■ At full employment, the U.S. economy is unlikely to accelerate in 2016, yet is on course
to experience its longest expansion in nearly a century, underscoring our long-held view
of its resiliency. We believe that those who see an even weaker future of U.S. secular
stagnation are too pessimistic and overlook the benefits of an unlevered expansion.
■ As we have discussed in Vanguard’s past outlooks, policymakers are likely to continue
to face difficulties achieving 2% inflation over the medium term. As of December 2015,
however, some of the most pernicious long-term deflationary forces are beginning to
moderate cyclically for the first time since 2006.
■ We anticipate a “dovish tightening” cycle by the U.S. Federal Reserve, and we continue
to view the global low-rate environment as secular, not cyclical.
■ Although not bearish, Vanguard’s outlook for global stocks and bonds is the most
guarded since 2006, given the low-interest-rate and low-earnings-yield environment.
====
