{"id":80585,"date":"2009-12-14T04:53:00","date_gmt":"2009-12-14T09:53:00","guid":{"rendered":"http:\/\/www.businessinsider.com\/rbc-beware-a-double-dip-and-a-disorderly-collapse-of-the-us-dollar-in-the-second-half-of-2010-2009-12"},"modified":"2009-12-14T04:53:00","modified_gmt":"2009-12-14T09:53:00","slug":"rbc-beware-a-double-dip-and-a-disorderly-collapse-of-the-us-dollar-in-the-second-half-of-2010","status":"publish","type":"post","link":"https:\/\/mereja.media\/index\/80585","title":{"rendered":"RBC: Beware A Double Dip, And A Disorderly Collapse Of The US Dollar In The Second Half Of 2010"},"content":{"rendered":"<p><em>(This guest post originally appeared at the <a href=\"http:\/\/pragcap.com\/rbcs-2010\">author&#8217;s blog<\/a>)<\/em><\/p>\n<p>There appears to be a similar outlook playing out among the major Wall Street strategists &ndash; H1 of 2010 will be very strong as the trends of late 2009 continue to play out while H2 2010 will be fraught with risks that could lead to a sizable market downturn.&nbsp;&nbsp; RBC&rsquo;s 2010 outlook is very similar to that of Credit Suisse &amp; Morgan Stanley (<a href=\"http:\/\/pragcap.com\/credit-suisse-equities\" >read the full CS outlook here<\/a> &amp; <a href=\"http:\/\/pragcap.com\/morgan-stanley-stocks-are-set-to-decline-in-2010\" >the MS outlook here<\/a>).&nbsp;&nbsp; RBC sees 4 major themes playing out in 2010:<\/p>\n<blockquote>\n<ul>\n<li>Fundamentals will continue to rebound led by growth<\/li>\n<\/ul>\n<ul>\n<li><a href=\"http:\/\/pragcap.com\/rbcs-2010#\" ><\/a>Market technicals remain supportive, though slightly rich<\/li>\n<\/ul>\n<ul>\n<li>External backdrop improving, though risks abound<\/li>\n<\/ul>\n<ul>\n<li>Remain bullish in H1 with &lsquo;catch-up&rsquo; trade; adopt defensiveness on approach of H2<\/li>\n<\/ul>\n<\/blockquote>\n<p><a href=\"http:\/\/pragcap.com\/jp-morgan-em\" >Like JP Morgan, they are particularly bullish on emerging markets<\/a>:<\/p>\n<p style=\"padding-left: 30px;\">The outlook for Emerging Markets (EM) is decidedly bullish on a long-term basis which should translate into solid returns in 2010 (particularly in H1), though the ongoing fallout from the financial crisis will continue to require disciplined risk management.<\/p>\n<p>Heading into the back half of 2010 they see substantial risks arising.&nbsp; Among them are these 5 primary concers:<\/p>\n<ul>\n<li>A possible double-dip (U.S. or global) looms once fiscal support measures are allowed to expire if private-sector demand has not recovered sufficiently to carry the economy on a sustainable growth path, leaving the economy vulnerable to a return to another recession (possibly in 2011-12).<\/li>\n<\/ul>\n<ul>\n<li>The US dollar collapses in a disorderly fashion causing commodity prices to rise quickly, triggering a tightening of monetary policy globally that weakens the global recovery.<\/li>\n<\/ul>\n<ul>\n<li>EM policy makers employ increasingly unconventional policy measures to slow the appreciation of their currencies versus a trend-weakening of the USD, raising investor concern over EM policymakers&rsquo; commitment to market-oriented policies and preventing progress in correcting global imbalances.<\/li>\n<\/ul>\n<ul>\n<li>Fiscal largesse amongst EM countries is not reigned in as improved access to international markets gives governments a false sense of security, which eventually causes a trend deterioration in the debt burden (debt\/gdp) of most countries, weakening a key leg of the EM investment case.<\/li>\n<\/ul>\n<ul>\n<li>A loss in confidence of governments in the G-7 to re-impose fiscal discipline and put debt dynamics on a sustainable track leads to rising long-end yields globally, a strengthening in the USD and tighter access to financing, triggering other &lsquo;Dubai-like&rsquo; events.<\/li>\n<\/ul>\n<p>Source: RBC<\/p>\n<p><strong><a href=\"http:\/\/www.pragcap.com\">Read more market commentary at PragCap &gt;&gt;<\/a><\/strong><\/p>\n<p><a href=\"http:\/\/www.businessinsider.com\/rbc-beware-a-double-dip-and-a-disorderly-collapse-of-the-us-dollar-in-the-second-half-of-2010-2009-12#comments\">Join the conversation about this story &#187;<\/a><\/p>\n<p><b>See Also:<\/b><\/p>\n<ul>\n<li><a href=\"http:\/\/www.businessinsider.com\/henry-blodget-david-rosenbergs-outlook-for-2010-2009-12\">David Rosenberg&#8217;s Outlook For 2010<\/a><\/li>\n<li><a href=\"http:\/\/www.businessinsider.com\/the-euro-breakup-may-be-the-story-of-2010-as-analyst-expects-ireland-and-greece-to-leave-the-union-2009-12\">The Euro Breakup Will Be THE Story Of 2010, As Analyst Expects Ireland And Greece To Leave The Union<\/a><\/li>\n<li><a href=\"http:\/\/www.businessinsider.com\/goldman-here-are-the-top-8-trades-for-2010-2009-12\">Goldman: Here&#8217;s How To Make A Killing In 2010<\/a><\/li>\n<\/ul>\n<p><img loading=\"lazy\" decoding=\"async\" src=\"http:\/\/feeds.feedburner.com\/~r\/TheMoneyGame\/~4\/AOXY77muOIY\" height=\"1\" width=\"1\"\/><\/p>\n","protected":false},"excerpt":{"rendered":"<p>(This guest post originally appeared at the author&#8217;s blog) There appears to be a similar outlook playing out among the major Wall Street strategists &ndash; H1 of 2010 will be very strong as the trends of late 2009 continue to play out while H2 2010 will be fraught with risks that could lead to a [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[7],"tags":[],"class_list":["post-80585","post","type-post","status-publish","format-standard","hentry","category-news"],"_links":{"self":[{"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/posts\/80585","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/comments?post=80585"}],"version-history":[{"count":0,"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/posts\/80585\/revisions"}],"wp:attachment":[{"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/media?parent=80585"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/categories?post=80585"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/tags?post=80585"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}