JP Morgan Asset Management

Back in the 1950s equities were seen as yield products, being as utility type assets. It was only from the 1960s that stocks were seen as growth assets. 2011 has been a watershed because yields have exceeded bond yields

It is therefore no doubt poignant to many to note that recently the 30-year total return on US Treasuries exceeded that of the S&P 500. Does that mean that the cult of equity is over? Certainly the cult may be, but it is highly improbable that equities are finished

The two big macro themes that investors should keep in mind are those of deleveraging and rebalancing. There has been a ream of insight written about fiscal sustainability over the past three years, but the most important question lies in whether there will be an offsetting “relevering” of activity

The lesson to take from this price action is that the “decoupling” arguments should be treated with a healthy dose of scepticism, and any move into global recession would be damaging for the asset classes.

By announcing that it would no longer tolerate the CHF stronger than 1.20 against the EUR and highlighting that in its opinion the CHF was still overvalued above 1.20, the SNB signalled that it was prepared to intervene in the FX market to sell CHF in unlimited quantities…