Epstein Secrets

vely long in EM local markets, favouring Poland, South Africa and Brazil. • Equities — We exit our OWs in EM vs. DM, our overweight in MSCI BRICs vs MSCI EM and Cyclical vs. Defensive sectors globally. • Credit — Stay with a range of credit overweights: Long US, EM and Europe. • Foreign exchange — Carr

whole has higher than average cash holdings and some 70% of world holdings offer no positive yield after taxes and inflation. See recent issues of Flows & Liquidity. EFTA00630374 What trigger is left to push up risk markets to the next level? — Accepted there is no obvious trigger as there was before EMU Summ

han EM. • Are depressed valuations a good reason to buy EM equities? We do not think so, either. It is true that the PE gap between MSCI World and MSCI EM indices has been widening for two years now to well above historical averages, 3.8 pts currently vs. a historical average of 2.7. This 3.8pt gap is

t are strong positives. At this point, we see more upside on our European growth forecasts than in the US. In addition, as we argued in last week's Flows & Liquidity, Who is driving the great rotation?, Aug 2, US investors are moving from fixed income into equities but we are not seeing this rotation in Europe, g

an EM. * Are depressed valuations a good reason =o buy EM equities? We do not think so, either. It is true that the PE gap between=MSCI World and MSCI EM indices has been widening for two years now to well=above historical averages, 3.8 pts currently vs. a historical average of 2=7. This 3.8pt gap is

t are strong pos=tives. At this point, we see more upside on our European growth forecasts =han in the US. In addition, as we argued in last week's Flows & Liquidity, Who is driv=ng the great rotation?, Aug 2, US investors are moving from fixed inco=e into equities but we are not seeing this rotation in Europe, g