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Garnry on equities: "It feels like a bubble"
"It's the first time in three years I've had the feeling it's a bubble", the words of Saxo Bank's Head of Equity Strategy, Peter Garnry. Peter says up to now he's largely played down the effect monetary policy has had on stocks, but things are changing. He also believes the US Federal Reserve has missed a golden opportunity to scale back its quantitative easing programme.
Peter says what's concerning him now is that stocks continue to climb, no matter what the data appears to indicate. He says the US economy is definitely improving and it doesn't need the USD 85 billion bond buying programme. It's certainly time, he says, for the Fed to begin to taper.
That said, Peter's keen to stress he's still very bullish on stocks long term and he sees the repricing between bonds and stocks to be an ongoing theme for the next couple of years. But in the short term, the "air will likely come out" of this bubble and it is much needed, he says.
02:02 minutes
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