Key highlights from this interesting read.
Higher rated reduce the value of the Future cash flow, weighing in on the growth stocks and reinforcing their developed market equities underweight status.
Growth stocks have outperformed value stocks most in the past decade thanks to the low interest rates in the market.
Persistent inflation is likely to lead investors to demand more compensation for holding longer term government bonds driving yields higher.
Financials as a sector can benefit from this high interest rate environment due to the improved net interest margin after years of low interest rates.
Aging and shrinking population has lead to China's rate of economic progress to slow down. (Estimates suggest 41mn workers went out of the workforce in the last 3 years.)
Tactically Developed market equities not pricing in the risks ahead. The earning recession is still coming ahead.
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