From: US GIO To: Undisclosed recipients:; Subject: Eye on the Market, March 10, 2011 Date: Thu, 10 Mar 2011 20:07:13 +0000 Attachments: 03-10-11_ EOTM - Printing_ Press_ Revisited.pdf Inline-Images: image001.png Please join us next Tuesday, March 15, at 11:00 am ESTfor a conference call on the "Ides of March" topics discussed last week (see box). Vali Nam Professor of International Politics at The Fletcher School of Law and Diplomacy, will join us. Mr Nasr, a specialist on political and social developments in the Muslim world, is a Senior Advisor to the US. State Department on South Asia. You can get the dial-in information for the webcast from your coverage team. As shown in the table below, as March began, the world was benefitting from a global recovery that was broadening and deepening. This recovery has run headlong into a series of events that were both foreseen and unforeseen. The eruption of political risk across the Arab world has been something of a surprise, although conditions leading to it were well understood for years. As for problems in the European Monetary Union and the impact of tightening policy in Asia, they have been familiar refrains around here for months, and were central to our 2011 Outlook. The whole point of the cover of the 2011 Eye on the Market was that removal of the stimulus tsunami was never going to be that simple, that parts of the recovery were very stimulus-dependent; and that the tsunami itself led to a variety of disruptions (e.g. rapidly rising commodity prices, particularly in the wake of the Fed's August 2010 Jackson Hole speech) whose regressive consequences were troubling. Instead of the traditional EoTM commentary, this week I wanted to share the attached charts on oil, Europe, China, equity markets and monetary policy that speak mostly for themselves (see attached PDF file). They are part of our rationale for holding less equity risk than what you might normally associate with a period of elevated