02. MACROECONOMICS & STRATEGY
Summary – Outlook
2 credible scenarios
1. Perfect “soft landing” ✓
Through gains in purchasing power
✓ With the pursuit of inflation-limiting productivity ✓ Favouring a fall in key rates
2. “H ard landing” ✓
By spreading the increase in rates
✓
Leading to job losses
✓
And a rise in the savings rate
➢ US markets anticipate the “perfect landing”: ✓ Lower rates, as during a slowdown ✓ Continued earnings growth (+14% in 2025) ✓ No risk premium over bonds
➢
US market is at risk: ✓
Cycle: economic growth is above its historical rate and potential ✓ Valuation: risk premium at 0%, as in 2000, compared with 2% in 2007 ✓ Psychology: flows and capitulation to be bearish
➔ We have to be more cautious
Public
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Source : Rothschild & Co Asset Management – 2024
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