MICHEL PIREU: How euphoria at Davos may signal the start of cooling of red-hot markets
Guggenheim investment chief says sentiment at the World Economic Forum gathering could be a valuable contra-indicator
Scott Minerd, the investment chief at the $242bn Guggenheim Partners said in a letter from Davos that he’s troubled by the euphoria. "Two years ago, when I last attended, a growing consensus saw the global economy at the brink of recession," Minerd wrote. "Stocks had sold off, and many pundits predicted that we were at the brink of a new bear market. Oil was collapsing … declining asset prices were offered up as full evidence that the US and probably the entire global economy was at the precipice of recessions." Instead, the world was on the brink of another bull market run that has since seen stock markets set records, at times almost on a daily basis. "As things kicked off in Davos, the sentiment could not have been more radically different from January 2016," Minerd said. "Global growth is accelerating, and risk assets are soaring. Sentiment is so positive, it feels like the discussion will focus on ‘How high is up?’ [And] while I am still a Davos neophyte, I am starting to consi...
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