Brentwood Group sources suggest that recessions in the US, Europe and the UK will last longer than any downturns in the emerging economies of Brazil, Russia, India and China.
The Asian-based asset management firm is thought to believe that excessive consumer and government debt in the developed economies is not mirrored in the emerging markets and, as such, the governments of those nations will resume their growth uptrend fairly swiftly.
One of the Brentwood Group sources cited China’s foreign exchange reserves as being the largest in the world at nearly $2trn dollars. The country has a large trade surplus with the rest of the world and is better able to maneuver through any inflationary period without sacrificing growth.
Brentwood Group’s analysts are reportedly seeking opportunities for stock acquisition in Brazilian and Chinese companies which have taken a beating broadly in line with those on stock markets around the globe.
Brentwood Group clients have been advised to avoid seemingly cheap US and UK stocks on grounds that price-to-earnings ratios are not as attractive as they appear given that earnings are likely to suffer in the short to medium term.
