Why we have been defensively positioned since early May 2011

Nancy Curtin is chief investment officer of Close Asset Management......

The European debt crisis and the US debt ceiling debate have dominated headlines, but we think the real story unfolding is probably that of a synchronous global slowdown. The dismal Q2 growth in the US economy, the rapid slowing in the core eurozone economies and China as indicated by respective Purchasing Manager Indices demonstrate this point fittingly. In many respects, the real issue behind the financial crisis of 2008, ie excessive debt in the developed world, has not really been resolved. The ‘crisis management’ policies of past two years have merely shifted the private sector de...