Bob Janjuah was interviewed by Bloomberg TV's Erik Schatzker: Among the three key themes underlying his skeptical views are the following:
i) Asia slow down (hard or soft) which will have implications on US markets;
ii) Is Europe closer to the endgame; and
iii) the US recovery
Janjuah believes that a reallocation out of Emerging Markets and into Developed Markets makes sense (time for reverse reverse decoupling already?). "I think we are going to have a deeper and harder slowdown in Asia, I think the European situation is closer to the endgame, my biggest doubt is on the US recovery...I think in Q2 and Q3 the grow slowly weakens, and much like last year we are going to be looking for QE3, and my concern is that the hurdle rate for further policy, fiscal and monetary, is much much higher."
"The Euro will either be the next reserve currency... or it won't." His personal view: "I am more optimistic today than I was two months ago."
Everyone seems to have awoken and realized that the only reason the stock market is where it is is due to the Fed's intervention in capital markets, Bob says that absent QE2, the S&P would have ended 2010 "closer to 1,000 than 1,200."
In terms of biggest risks, Janjuah says the
i) "melt up" is the biggest risk, becase "we are building a bubble";
ii) jobs in the US are number two (one more month... just one more month we promise and we will have jobs growth... ignore all the other 18 consecutive months this has been said before), and
iii) is the bond bull market over - when do rising bond yields negate and reverse the "Tepper" trade?
