In recent weeks, we have encountered a
creeping sense of ‘déjà vu’ in many of our
conversations with clients. We’ve seen a
period since late December driven by
optimism about a domestic US recovery; signs
of a peak in global PMIs; fears about risks to
growth in 2011H2; rising concern about fiscal
sustainability in the G3; worries about a sharp
rise in bond yields driven by an end to QE and
perhaps a broader Fed exit; and an EM world
that has slowed after a period of tightening.
Isn’t this all reminiscent of April 2010?
Behind that comparison—and the more
difficult markets that it would imply may lie
ahead—is the usual (and statistically
grounded) fear that ‘selling in May and going
away’ is right more often than it’s wrong.