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Jakobsen: Risk and reality in the US economy
The US economy is stabilising, but it's not truly recovering. That's the view of Saxo Bank's Chief Investment Officer, Steen Jakobsen. Following the Fed's tapering news, Steen says the risk is that we trade on perception and not reality. Clearly, the outgoing Fed Chairman, Ben Bernanke, wanted to send a signal to the markets. Global equity markets, notably in the States, have been hitting record highs for weeks. Steen says we're coming to the end of that cycle.
He points out that actual growth in America is well below the average rate of the past sixty years. Job creation too is lagging. People may be starting to feel more confident but that's still not translating into significantly higher employment or wages. We're at the end of asset inflation, he says, and that will dawn on the market very soon.
01:49 minutes
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