The All-Important Question

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Feature Article by David Galland
For pretty much everyone, no matter where they are located in the
economic strata, few if any questions are more germane to making plans
for the future than whether the US and other major global economies are
in recovery.
Getting the answer to that question right is of special importance to investors and businesses.
Stating
the obvious, if the broader economy really is in recovery, then
investors would be well served by investing in the equities of solid
companies positioned to take advantage. Similarly, those very same solid
companies would be rewarded by increasing their productive capacity
through investments in the plants and people necessary to meeting
growing demand.
On the same side of the ledger, bond investors
would want to begin shorting up their durations or leaving the bubbly
bond market altogether, in anticipation that the flood of funds into
fixed income would reverse, sending rates higher (and bond prices
lower).
Conversely, if the recovery is a head
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