Why 'reasons for caution' on global growth are being overlooked

The myriad monetary policy easing measures observed across the globe allied with (admittedly, more modest) fiscal stimulus from countries such as China, Japan, France and the UK has led investors to believe that economic growth going forward is well underpinned, and indeed, may surprise to the upside.

Furthermore, the US labour market, while strong, appears to have become less tight which suggests that inflationary risks will remain fairly well behaved for now.  However, reasons for caution are being overlooked. US equity valuations are high relative to history and decent earnings growth needs to return to justify current market multiples. Global growth pick-up key to higher bond yields However, corporates continue to hold too much inventory, which means a positive turn in the earnings cycle may be a little further away than people hope.  Moreover, if global economic growth d...