SocGen Presents The Biggest Investing Trends In 2011


Societe Generale have made their 2011 predictions, focusing on the rise of inflation world wide and the declining appeal of emerging markets equities.

Inflation may be supportive of equity growth in some places, according to SocGen, but not in all.

The warnings about China are here, but also about the bond market, a place investors may want to avoid.

Liquidity is surging, in support of risky assets.

But all that liquidity is leading to rising inflation fears.

Liquidity is leading to inflation in Asia, particularly in food.

China is a key example of a country impacted by this flood of liquidity.

Expectations for inflation rate hikes are higher, especially in China.

But the same inflation that worries China may actually be great for Japanese equities.

Chinese manufacturing continues to drive global commodity prices.

While industrial production across the region is continuing to surge.

Emerging market equities are continuing to head higher.

But now those emerging market equities are hardly attractive.

But, somewhat surprisingly, BRIC equities are under performing broader EM equities.

Yet, EM equities are still outperforming developed markets.

So BRIC equities might still be a good idea.

In the U.S., confidence is soaring.

U.S. manufacturing is bouncing back.

And with business inventories about to swing lower, it may be time for restocking.

And inflation expectations are rising.

And the low yield on bonds created through Fed intervention...

Are making risk assets like equities more attractive.

But if all this inflation isn't a good thing, gold might be appealing.

Want a closer look at the world's macro picture?

Business Insider Emails & Alerts

Site highlights each day to your inbox.

Follow Business Insider Australia on Facebook, Twitter, LinkedIn, and Instagram.