2011 – U.S. stock strategy “a 3 R” is also expected to expand the economy and stock prices strong in-Tokai Tokyo Research Center

The U.S. is still having financial homework. Excessive debt bubble bursts, repair of household balance sheets and financial institutions (repair) has persisted. For these structural changes have been beaten many hands, the interest rate the lowest ever, to support the stock market through excess liquidity has also developed to facilitate ever greater quantity. By continuing structural adjustment, cyclical economic recovery (recovery) is ongoing. The average total economists predicted the U.S. economy, the economic future is a little change up the New Year. And repair to remain relatively high unemployment rate in 2011 may be incomplete, the ratio of household debt is low in tone, focusing on economic recovery in personal income demodulation consumption, corporate earnings will keep pace growth. And if work continues to recover, the stock market bear market revenge (revenge) that he will continue to be the main scenario. 0.1200-S & P500 Index has remained steady around 1400 points, the Dow Jones Industrial Index has been expanded such that the image of a challenge than the end of 13 000 U.S. dollars.

Speaking of proportion, already (bond) debt market is “beginning of the end” as has begun. In Japan, the largest foreign fund was about “Gurosobu” appears that the money from the main funds managed by PIMCO world’s largest fund manager about the United States that “Totaruritanfando” performance has been poor. Some bond funds derived from these products, REIT, it seems to be going to risk assets such as stocks. Alarming pattern of only two risk scenarios. First, if the economy is slow as I had expected. After adjustment of the balance sheets Zureshi family and financial institutions, and performance is a case of slow economy. In this case, is expected to remain in the sphere of possibility that stock box. Another is to accelerate economic recovery than the market thinks that interest rates come to observe more than was previously predicted. Be fixed at a normal level of interest rates and low interest rates, but rather it would be nice if they could push up interest rates further strengthening of interest rates observed long-term , the stock will react negatively at least temporarily. Worst case, the chances are low, but the revival of U.S. economic anxiety dip double, spread to other markets in the affairs of the euro area sovereign. China’s economic slowdown is also going great, but the case falls in the global economy is L-shaped recession. This will be done once all bear market in global equity markets, S & P500 in the U.S. will be forced to drop to 1,000 points in mind.

As long as a sustained economic recovery in sight or even the main scenario, as described in, soft-sensitive industries will be looking to the economy. Materials, capital goods, consumer goods and its services. The economy will also boost the effect that the share price rises. Approximately 80% of wealth in America, is said to have held high-income population of about 20%, easily the fall purse strings to increase the wealth effect of stock. If these trends continue, by 2011 and auto-related consumer retail is said to be cyclical consumer prices will also lead to high-tech industry. Margin of increasing the slope of the curve in the bond market, stock prices will boost the financial turnaround of the bad round. promise REIT is expected to continue to improve if you improve the recovery of the market for commercial real estate in consumer spending and employment situation in the market as well. In the U.S., “bird in the hand theory (Bird In Hand theory)” There is the concept. Ie, capital gains on expectations that stocks like two birds that appear and disappear behind the bushes, a bird that laid eggs firmly in hand, the REIT investment more attractive, such as There is also deeply rooted and that it has need. REIT yields are higher than bonds Toshi Kon distribution is expected to come out of dividends and dividend funds for rent, if economic recovery continues.