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Scott Minerd
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As Chairman of Guggenheim Investments and Global Chief Investment Officer, Mr. Minerd guides the Firm’s investment strategies and leads its research on global macroeconomics. Prior to joining Guggenheim Partners, Mr. Minerd was a managing director at Morgan Stanley and Credit Suisse. He is... More
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  • Christmas Ghosts And The Global Economy 0 comments
    Jan 2, 2013 8:33 AM

    China has recently been showing signs of accelerating economic activity. The Shanghai Index is up 13% since the third of December. Xi Jinping, the new Chairman of the Communist Party, whose father was seen as one of Deng Xiaoping's most reform-oriented lieutenants, appears to be dedicated to carrying out Deng's vision and is likely to bring greater modernization and free-market capitalism to the Chinese economy. The much feared hard landing in China seems to now be a fading phantom, like the ghost of Christmas past.

    Europe can be interpreted as the ghost of Christmas present this year. Although the economy there is not showing any significant improvements, the political process still seems to be moving forward. It appears there will be a new bank regulatory structure under the European Central Bank (ECB). With a centralized bank regulator in Europe it will be much easier for the ECB to manage the individual financial crises within each country.

    In the U.S., we should not be fearful of the ghost of Christmas yet to come. Markets are discounting mechanisms, and the stall in fourth quarter equity performance reflects the fact that the uncertainty around the fiscal cliff has already been priced in. In spite of the worries around the cliff, the real world fundamentals continue to improve. Virtually every piece of data that has come out lately indicates improving economic activity.

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