Current Key Issues Ahead

On today's market wrap on financialsense, Tony Allison wrote: Trading, Investing and Speculating

• Today’s culture seems to have a very short-term perspective on the just about everything. Wall Street focuses on this quarter’s results; Washington’s vision extends only to the next election cycle. The average Joe looks to the coming weekend, or perhaps his next paycheck. As the nation’s attention span appears to shorten further every year, so does its vision of the future. And as investors, it seems more and more people are adopting the behavioral characteristics of the trader.
  
  Looking out at some of the key economic issues directly in front of us we see:

1. The oversold US dollar starting to strengthen, as most of the planet has been in the “short the dollar” side of the boat this year.
2. Commodities starting to correct as the dollar strengthens, after a big run-up this fall.
3. Developing countries like China and Brazil looking ready for a correction.
4. The possibility of de-leveraging reasserting itself in 2010.

Rather intesting issues, issues which were as mentioned by Dr. Marc Faber in the posting Dr. Marc Faber Investment Suggestions For 2010

• Smart investors who made money in 2009 may sell emerging market stocks and start buying the S&P in the US as it may outperform because of a rally in the US dollar..
• Global stocks, commodities and precious metals have rallied sharply this year following an unprecedented easing of monetary policy by central banks across the globe to avert a 1930s-like depression. The rally has pushed mainly emerging market stocks to high valuations which may not be backed by a corresponding earnings growth. Hence, western investors who were borrowing cheap and investing in emerging markets may get back to buying assets in developed markets which are recovering and partly in anticipation of higher interest rates too.

ps: the article highlighted by Tony is also rather interesting: The Debt Bomb