Overview
Looking at the outlook of the major asset classes, there is potential for a break in the clouds. But overall, the things we have been worried about for some time—high valuations for certain risk assets, record-low interest rates, slow economic growth—have not gone away. We remain concerned that investors are stuck in a low-return world where they will struggle to earn 5% in real terms. As we look across asset classes, we see moderate to expensive valuations, solid but not spectacular fundamentals, and wildcards such as geopolitical shocks.