Investment Themes: The Global Perspective

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* Mixed Global Picture - Here we see year-to-date returns for the S&P 500 value stocks (IVE); S&P 500 growth stocks (IVW); EAFE value shares (EFV); and EAFE growth issues (EFG). Notice that growth has been underperforming value in the U.S. (observe recent weakness among such stocks as GOOG and AAPL), but not in Europe, Australasia, and the Far East. Returns are negative all around, but while many economies are dealing with double-digit inflation rates, recession seems to be the larger concern in the U.S.--recent commodity spikes notwithstanding. Mr. Bernanke's testimony to Congress on Wednesday will play an important role, given this backdrop.

* Returns Across the Globe - Year-to-date, the S&P 500 (SPY) is down 5.37%. Interestingly, China (FXI) is down 12.31% over that same period. Indeed, a chart of FXI doesn't look so different from a chart of many U.S. growth issues. Japan (EWJ) is down only 3.01% year-to-date; Europe large caps (IEV) are down 6.24%, but Hong Kong is down 13.59%. Meanwhile, Brazil (EWZ) is up 3.92% and Latin America more broadly (ILF) is up 4.12%. As we're seeing with U.S. growth stocks, what had been strong (China, Hong Kong) is now being sold and what had been weak (Japan) is holding up better. Resource rich Brazil is performing far better during this commodity boom than resource consumer China.