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Foot Soldiers Or Generals?

“His outward appearance seemed indifferent and unconcerned over the wretchedness of his soldiers…although French and Allies shouted into his ears many oaths and curses about his own guilty person, he was still able to listen to them unmoved.”

-Jakob Walter, German soldier under Napoleon

 

Two hundred years ago, following one of the most brutal military campaigns in history, thousands of young European men traipsed through the snow of East Prussia, half-dead.  The Diary of a Napoleonic Foot Soldier, by Jakob Walter, is a harrowing but thoroughly enjoyable account of what it was like to serve in Napoleon’s Grand Armée during the ill-fated invasion of Russia in June 1812.  Given that one is as likely to be born in one country, at one time, as another country at another time, I am particularly grateful I was not one of the 600,000 Napoleonic soldiers that crossed into Russia in mid-1812.  Of the 140,000 that were left to retreat from Moscow, only 25,000 actually crossed back over the border in December 1812 to begin the long walk home.

 

Few individuals have left as indelible a mark on history as Napoleon Bonaparte.   That he was born in Corsica of Italian heritage but went on to gain the title “Emperor of the French” is indicative of the strength of personality he possessed.  All of his courage and decisiveness meant little without the contribution of his subjects.  Napoleon understood this; it is estimated that between 1800 and 1815, he raised approximately two million conscripts, or 7% of the population, in France alone.   Was the future of 18th Century France (or 1930’s Germany or Russia) dictated by the common man’s wishes or a charismatic leader dragging a country toward his vision?  This question has no definitive answer but it can serve as a loose metaphor for policy versus demographics in our contemporary economy.  While demography is concerned with the passive role people play in economies, the roles of the common man and policy maker in driving economic growth are important to consider in 2013.  Harry Dent, author of several books on demographics and its importance states: “it’s Homer Simpson that drives our economy, not Ben Bernanke or Barack Obama!”

 

I recently did some long overdue reading on demography.  While my understanding of the subject is tenuous at best, it is clear to me that understanding the role of demographic and technology cycles is key to understanding what drives our economy over the long term.  Hedgeye Healthcare Sector Head Tom Tobin and his team have produced some excellent research that anchors off these topics.  Recently, his work has suggested that household formation, maternity, and pet ownership (WOOF) rest on a similar age demographic and are likely to see corresponding strength.  While the increasingly short-term nature of our industry has marginalized such thought processes, we continue to believe that identifying investment themes that deviate from consensus but are supported by long-term cycles can lead to highly actionable ideas.

 

Considering some of the key demographic trends pertaining to the consumer economy offers interesting long-term insights.  In terms of the sector my team covers, restaurants, the core demographic of casual dining companies tends to be the 45-65 YOA cohort.  For any consumer industry executive, decelerating population growth among age cohorts with a high propensity to spend money on your goods or services will act as a top-line headwind.  Pertaining to the restaurant industry, it is clear that for many years executives’ lives were made easier by a rising demographic tide.  We believe that casual dining is facing a painful adjustment due to excessive unit growth.  Trading opportunities on the long side will remain, on immediate-to-intermediate-term bases, but we see casual dining as a group that will experience consolidation for a number of years.  It is no coincidence that the management teams that are most demonstratively aware of the demographic headwind are running the companies whose shares we are relatively positive on (EAT – at a price).  Darden Restaurants (DRI) is one company that we became bearish on in July.  One of the key issues we took with management’s strategy was its growth trajectory and we continue to believe that it is overly aggressive relative to the fundamental performance of its chains and the overall health of the industry.  The quote, below, from Brinker (EAT) CEO, Guy Constant, highlights the reality of the situation facing his industry and his company’s awareness of it:

 

“…We've had to deal with those questions internally because as a company that's only ever been in a growth space, it's been an adjustment for us to adjust to running a business in a more mature space now than we did before. But knowing then that history, we believe, is repeating itself, that helps you understand what you need to do in order to survive in this space.”

 

While long-term demographic and technology cycles dictate economic growth, from an investment perspective, it is self-evident that policy has a significant impact on market prices as well as the duration and amplitude of economic cycles.  The market, after all, is not the economy.  Previously, I have wondered if forming an opinion on government policy is a worthwhile exercise.  Long-term cycles seem to bear out over time regardless of government policies (give or take a few years).  In recent times, our macro team’s process of focusing on Growth, Inflation, and Policy has proven effective in identifying key inflection points in markets, globally.  Moreover, the level of government intervention in markets implores investors to form an opinion on policy and to update it, regularly.  For example, investors in gold that have ignored policy, and the expectations around it, have had a difficult time of late. 

 

Our view of policy makers in the US (and almost everywhere else) has been decidedly negative.  Keith wrote in yesterday’s Early Look: “What if Bernanke is what he usually is – wrong on his growth forecasts? What if unemployment rate expectations start to fall towards 6.5% in 2013 instead of in 2017? Inquiring Bond and Gold bulls would like to know…”  Yesterday we saw gold and bonds get crushed on the expectation that Bernanke could be forced to call back his troops if expectations of employment growth improve sufficiently.  Every general meets his Waterloo.  The only question is when.

 

Timing, as always, is the critical factor in investing but even more so in life.  After all, if not for timing, we could have been Napoleonic foot soldiers.

 

Have a great weekend,

 

Rory Green

Senior Analyst

 

Foot Soldiers Or Generals? - Chart of the Day

 

Foot Soldiers Or Generals? - Virtual Portfolio


TRADE OF THE DAY: EZPW

Today we shorted EZ CORP (EZPW) at $20.15 a share at 3:19 PM EDT in our Real-Time Alerts. Along with Cash America (CSH), EZ CORP will be one of the pawn shop operators affected by gold’s recent downturn. When gold falls, it takes pawns down with it. We remain bearish on the stock through Q1 2013.

 

TRADE OF THE DAY: EZPW - image001

 


MNST - Buying Mispriced Growth

When we initiated coverage of the consumer staples sector a couple of weeks back, we highlighted two "broken" growth stories as being interesting - MJN (+5.9% since 12/17) and MNST (-1.4%).  Admittedly, MJN's market share and pricing issues in China were easier to get comfort with versus the more open-ended spectre of the possible regulation of energy drinks, but we see the outcomes as ultimately being the same - investors will go back to paying a premium multiple for the underlying growth profile in both stories.

 

It is our belief that the FDA has as much business regulating energy drinks as we do - which is to say, right around no business at all.  And while the timing of a likely favorable outcome is unclear, we believe that investors will be rewarded for picking their spots in this name, as we did today.

 

MNST - Buying Mispriced Growth - MNST Mispriced

 

MNST - Buying Mispriced Growth - MNST T T

 

 

Robert  Campagnino

Managing Director

HEDGEYE RISK MANAGEMENT, LLC

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Hedgeye Statistics

The total percentage of successful long and short trading signals since the inception of Real-Time Alerts in August of 2008.

  • LONG SIGNALS 80.28%
  • SHORT SIGNALS 78.51%

OZM: Leading The Pack

Och-Ziff Capital Management (OZM), one of the few publicly traded hedge funds on the market, crushed December with their Master Fund gaining 1.0% month-over-month, ending 2012 up 11.18%. Their European Master Fund and Asia Master Fund were up 8.62% and 7.07% for 2012, respectively. Compared with the benchmark HFRX Global Hedge Fund Index 2012 return of 3.17%, OZM had a killer year.

 

OZM: Leading The Pack  - OZMchart

 

Though fund flows (money going into the fund) were negative for December by ~$450 million, they were positive for the year at $300 million. We expect more inflows into Och-Ziff in 2013 based on last year’s strong performance numbers. 

 

The stock is one of our top long ideas in financials for 2013. We believe that the market has yet to recognize the value of OZM’s incentive fee business and now that the fiscal cliff is behind us, we see that there is no damaging regulation that will affect asset management firms save for the small bump in long-term capital gains rates. It’s also worth noting that alternative asset managers like hedge funds do well in times of quantitative easing and we are well into our third round of QE.


SIZING UP ASIA & LATIN AMERICA FOR 2013

Takeaway: By modeling each economy from a full-year G/I/P perspective, we are better able to contextualize country-specific risks and opportunities.

SUMMARY BULLETS:

 

  • To kick-start the new year, we invite you deep into our process as we model each of the economies we follow across Asia and Latin America from a comprehensive GROWTH/INFLATION/POLICY perspective.
  • From there, we compare the mid-points of our 2013 forecast ranges for both GROWTH and INFLATION with current Bloomberg consensus forecasts, calling out any meaningful deviations between the our numbers and the Street. In short, we currently hold a variant outlook versus the Street in the following countries:
    • China: INFLATION
    • Hong Kong: INFLATION
    • Indonesia: INFLATION
    • Japan: GROWTH and INFLATION
    • New Zealand: GROWTH and INFLATION
    • Philippines: GROWTH
    • Singapore: GROWTH
    • Taiwan: GROWTH
    • Thailand: GROWTH
    • Brazil: GROWTH
    • Chile: GROWTH and INFLATION
    • Colombia: INFLATION
    • Mexico: INFLATION
    • Peru: GROWTH
    • Venezuela: GROWTH and INFLATION
  • Lastly, we provide color on each country’s financial market performance in 2012, as well as update you on our active fundamental investment ideas for each country. If we do not currently hold a high-conviction thesis, we flag any country-specific asset classes that are currently screening as a LONG or SHORT idea at first glance.
  • To dialogue further on anything you see below or to drill into country-specific catalysts, etc., please email us at .

 

METHODOLOGY

As a reminder, all of our country-specific estimates are being driven by our proprietary predictive tracking algorithm – a clear differentiator from traditional sell-side econometric models that tend to be, at best, late at flagging critical deltas in economic fundamentals. 

 

The main drawback to our approach is that because of the model’s heavy reliance on recently-reported trends in the underlying data series, the forecasting error tends to widen dramatically as estimates track further and further away from the latest reported data point. That being said, we are purposefully sacrificing long-term accuracy for near-term precision, as most long-term predictions tend to be wildly inaccurate anyway.

 

It's also important to note that the output(s) of our predictive tracking algorithm is a band of probable outcomes, rather than a singular forecast. We take the median of these ranges to artificially produce comparable full-year estimates to the pin-the-tail-on-the-donkey-style estimates of the Old Wall.

 

Lastly, our forecasts are inherently fluid in nature and are likely to adjust throughout the course of the year as incremental data is reported – particularly in the event(s) of forecast variance. For now, we offer up what the model is currently signaling to us for each country.

 

 

ASIA

 

Australia

  • 2012 Equity Market Performance: +13.5% vs. a regional median gain of +17.7%
  • 2012 FX Performance (vs. USD): +1.8% vs. a regional median gain of +2.6%
  • 2012 Sovereign Debt Performance (10YR tenor, local currency): -40bps to 3.27%
  • Full-Year 2013 G/I/P Outlook: Quad #3 (slower GROWTH; faster INFLATION)
  • Key Callout for 2013: N/A
  • Active Fundamental Investment Ideas: We have held a bearish bias on the Aussie dollar (TAIL) and the Aussie equity market (TAIL) since JUN 5, 2012. While our timing has been off here, we continue to view the Australian economy as among the next shoes to drop amid the popping of Bubble #3 (commodities) and China’s economic rebalancing agenda.

SIZING UP ASIA & LATIN AMERICA FOR 2013 - AUSTRALIA

 

China

  • 2012 Equity Market Performance: +3.2% vs. a regional median gain of +17.7%
  • 2012 FX Performance (vs. USD): +1.1% vs. a regional median gain of +2.6%
  • 2012 Sovereign Debt Performance (10YR tenor, local currency): +15bps to 3.59%
  • Full-Year 2013 G/I/P Outlook: Quad #2 (faster GROWTH; faster INFLATION)
  • Key Callout for 2013: Our outlook for INFLATION in China is currently a bit hawkish relative to consensus at the present juncture.
  • Active Fundamental Investment Ideas: We have held a bullish bias on Chinese consumer stocks (TREND) since DEC 10, 2012.

SIZING UP ASIA & LATIN AMERICA FOR 2013 - CHINA

 

Hong Kong

  • 2012 Equity Market Performance: +22.9% vs. a regional median gain of +17.7%
  • 2012 FX Performance (vs. USD): +0.2% vs. a regional median gain of +2.6%
  • 2012 Sovereign Debt Performance (10YR tenor, local currency): -89bps to 0.63%
  • Full-Year 2013 G/I/P Outlook: Quad #1 (faster GROWTH; slower INFLATION)
  • Key Callout for 2013: Our outlook for INFLATION in Hong Kong is currently well shy of consensus at the present juncture.
  • Active Fundamental Investment Ideas: We have held a bullish bias on the Hong Kong equity market (TREND) since NOV 16, 2012.

SIZING UP ASIA & LATIN AMERICA FOR 2013 - HONG KONG

 

India

  • 2012 Equity Market Performance: +25.7% vs. a regional median gain of +17.7%
  • 2012 FX Performance (vs. USD): -3.1% vs. a regional median gain of +2.6%
  • 2012 Sovereign Debt Performance (10YR tenor, local currency): -52bps to 8.05%
  • Full-Year 2013 G/I/P Outlook: Quad #2 (faster GROWTH; faster INFLATION)
  • Key Callout for 2013: N/A
  • Active Fundamental Investment Ideas: N/A

SIZING UP ASIA & LATIN AMERICA FOR 2013 - INDIA

 

Indonesia

  • 2012 Equity Market Performance: +12.9% vs. a regional median gain of +17.7%
  • 2012 FX Performance (vs. USD): -5.5% vs. a regional median gain of +2.6%
  • 2012 Sovereign Debt Performance (10YR tenor, local currency): -84bps to 5.19%
  • Full-Year 2013 G/I/P Outlook: Quad #3 (slower GROWTH; faster INFLATION)
  • Key Callout for 2013: Our outlook for INFLATION in Indonesia is currently a bit dovish relative to consensus at the present juncture.
  • Active Fundamental Investment Ideas: N/A

SIZING UP ASIA & LATIN AMERICA FOR 2013 - INDONESIA

 

Japan

  • 2012 Equity Market Performance: +22.9% vs. a regional median gain of +17.7%
  • 2012 FX Performance (vs. USD): -11.3% vs. a regional median gain of +2.6%
  • 2012 Sovereign Debt Performance (10YR tenor, local currency): -20bps to 0.79%
  • Full-Year 2013 G/I/P Outlook: Quad #3 (slower GROWTH; faster INFLATION)
  • Key Callout for 2013: Our outlooks for GROWTH and INFLATION in Japan are both currently well above consensus at the present juncture.
  • Active Fundamental Investment Ideas: We have held a bearish bias on the Japanese yen (TREND, TAIL) since SEP 27, 2012.

SIZING UP ASIA & LATIN AMERICA FOR 2013 - JAPAN

 

Malaysia

  • 2012 Equity Market Performance: +10.3% vs. a regional median gain of +17.7%
  • 2012 FX Performance (vs. USD): +3.6% vs. a regional median gain of +2.6%
  • 2012 Sovereign Debt Performance (10YR tenor, local currency): -20bps to 3.5%
  • Full-Year 2013 G/I/P Outlook: Quad #2-3
  • Key Callout for 2013: N/A
  • Active Fundamental Investment Ideas: N/A

SIZING UP ASIA & LATIN AMERICA FOR 2013 - MALAYSIA

 

New Zealand

  • 2012 Equity Market Performance: +20.9% vs. a regional median gain of +17.7%
  • 2012 FX Performance (vs. USD): +6.6% vs. a regional median gain of +2.6%
  • 2012 Sovereign Debt Performance (10YR tenor, local currency): -30bps to 3.52%
  • Full-Year 2013 G/I/P Outlook: Quad #3 (slower GROWTH; faster INFLATION)
  • Key Callout for 2013: Our outlooks for GROWTH and INFLATION in New Zealand are both currently well shy of consensus at the present juncture.
  • Active Fundamental Investment Ideas: N/A, though the New Zealand dollar is currently screening as a candidate on the SHORT side.

SIZING UP ASIA & LATIN AMERICA FOR 2013 - NEW ZEALAND

 

Philippines

  • 2012 Equity Market Performance: +33% vs. a regional median gain of +17.7%
  • 2012 FX Performance (vs. USD): +6.8% vs. a regional median gain of +2.6%
  • 2012 Sovereign Debt Performance (10YR tenor, local currency): -101bps to 4.4%
  • Full-Year 2013 G/I/P Outlook: Quad #3 (slower GROWTH; faster INFLATION)
  • Key Callout for 2013: Our outlook for GROWTH in the Philippines is currently well above consensus at the present juncture.
  • Active Fundamental Investment Ideas: N/A; while Filipino stock market remains a long-term TAIL favorite of ours as a result of its prudent POLICY and robust GROWTH outlook, we are strategically on the sidelines for now.

SIZING UP ASIA & LATIN AMERICA FOR 2013 - PHILIPPINES

 

Singapore

  • 2012 Equity Market Performance: +19.7% vs. a regional median gain of +17.7%
  • 2012 FX Performance (vs. USD): +6.2% vs. a regional median gain of +2.6%
  • 2012 Sovereign Debt Performance (10YR tenor, local currency): -33bps to 1.3%
  • Full-Year 2013 G/I/P Outlook: Quad #1 (faster GROWTH; slower INFLATION)
  • Key Callout for 2013: Our outlook for GROWTH in Singapore is currently well above consensus at the present juncture.
  • Active Fundamental Investment Ideas: We have held a bullish bias on the Singaporean equity market (TREND) since DEC 21, 2012.

SIZING UP ASIA & LATIN AMERICA FOR 2013 - SINGAPORE

 

South Korea

  • 2012 Equity Market Performance: +9.4% vs. a regional median gain of +17.7%
  • 2012 FX Performance (vs. USD): +9.1% vs. a regional median gain of +2.6%
  • 2012 Sovereign Debt Performance (10YR tenor, local currency): -63bps to 3.16%
  • Full-Year 2013 G/I/P Outlook: Quad #2 (faster GROWTH; faster INFLATION)
  • Key Callout for 2013: N/A
  • Active Fundamental Investment Ideas: We have held a bullish bias on the South Korean won (TREND) since NOV 1, 2012 and a bullish bias on the South Korean equity market (TREND) since DEC 27, 2012.

SIZING UP ASIA & LATIN AMERICA FOR 2013 - SOUTH KOREA

 

Taiwan

  • 2012 Equity Market Performance: +8.9% vs. a regional median gain of +17.7%
  • 2012 FX Performance (vs. USD): +4.3% vs. a regional median gain of +2.6%
  • 2012 Sovereign Debt Performance (10YR tenor, local currency): -12bps to 1.17%
  • Full-Year 2013 G/I/P Outlook: Quad #1 (faster GROWTH; slower INFLATION)
  • Key Callout for 2013: Our outlook GROWTH in Taiwan is currently a bit shy of consensus at the present juncture.
  • Active Fundamental Investment Ideas: N/A

SIZING UP ASIA & LATIN AMERICA FOR 2013 - TAIWAN

 

Thailand

  • 2012 Equity Market Performance: +35.8% vs. a regional median gain of +17.7%
  • 2012 FX Performance (vs. USD): +3.2% vs. a regional median gain of +2.6%
  • 2012 Sovereign Debt Performance (10YR tenor, local currency): +22bps to 3.51%
  • Full-Year 2013 G/I/P Outlook: Quad #2 (faster GROWTH; faster INFLATION)
  • Key Callout for 2013: Out outlook for GROWTH in Thailand is currently well above consensus at the present juncture.
  • Active Fundamental Investment Ideas: N/A

SIZING UP ASIA & LATIN AMERICA FOR 2013 - THAILAND

 

Vietnam

  • 2012 Equity Market Performance: +17.7% vs. a regional median gain of +17.7%
  • 2012 FX Performance (vs. USD): +1% vs. a regional median gain of +2.6%
  • 2012 Sovereign Debt Performance (10YR tenor, local currency): -230bps to 10.2%
  • Full-Year 2013 G/I/P Outlook: N/A, due to non-standard data reporting
  • Key Callout for 2013: N/A
  • Active Fundamental Investment Ideas: N/A

 

LATIN AMERICA

 

Argentina

  • 2012 Equity Market Performance: +15.9% vs. a regional median gain of +11.7%
  • 2012 FX Performance (vs. USD): -12.4% vs. a regional median gain of +7%
  • 2012 Sovereign Debt Performance (10YR tenor, local currency): N/A
  • Full-Year 2013 G/I/P Outlook: Quad #2 (faster GROWTH; faster INFLATION)
  • Key Callout for 2013: N/A
  • Active Fundamental Investment Ideas: We have held a bearish bias on the Argentine peso (TAIL) and the Argentine equity market (TAIL) since NOV 4, 2010. While we continue to view the Argentine economy as a clear loser amid the popping of Bubble #3 (commodities) and China’s economic rebalancing agenda, we are increasingly inclined to strategically suspend our bearish bias on Argentina’s equity market in the near term, as a 2013 currency devaluation may spur Venezuelan-like stock market gains.

SIZING UP ASIA & LATIN AMERICA FOR 2013 - ARGENTINA

 

Brazil

  • 2012 Equity Market Performance: +7.4% vs. a regional median gain of +11.7%
  • 2012 FX Performance (vs. USD): -9.1% vs. a regional median gain of +7%
  • 2012 Sovereign Debt Performance (10YR tenor, local currency): -212bps to 9.17%
  • Full-Year 2013 G/I/P Outlook: Quad #2 (faster GROWTH; faster INFLATION)
  • Key Callout for 2013: Our outlook for GROWTH in Brazil is a bit higher than consensus at the present juncture.
  • Active Fundamental Investment Ideas: We have held a bullish bias on Brazilian consumer and industrial stocks (TREND) since DEC 5, 2012.

SIZING UP ASIA & LATIN AMERICA FOR 2013 - BRAZIL

 

Chile

  • 2012 Equity Market Performance: +3% vs. a regional median gain of +11.7%
  • 2012 FX Performance (vs. USD): +8.5% vs. a regional median gain of +7%
  • 2012 Sovereign Debt Performance (10YR tenor, local currency): N/A
  • Full-Year 2013 G/I/P Outlook: Quad #4 (slower GROWTH; slower INFLATION)
  • Key Callout for 2013: Our outlook for GROWTH in Chile is well above consensus at the present juncture. Our outlook for INFLATION in Chile is a bit dovish relative to consensus at the present juncture.
  • Active Fundamental Investment Ideas: N/A

SIZING UP ASIA & LATIN AMERICA FOR 2013 - CHILE

 

Colombia

  • 2012 Equity Market Performance: +16.2% vs. a regional median gain of +11.7%
  • 2012 FX Performance (vs. USD): +9.7% vs. a regional median gain of +7%
  • 2012 Sovereign Debt Performance (10YR tenor, local currency): -191bps to 5.47%
  • Full-Year 2013 G/I/P Outlook: Quad #1 (faster GROWTH; slower INFLATION)
  • Key Callout for 2013: Our outlook for INFLATION in Colombia is a bit dovish relative to consensus at the present juncture.
  • Active Fundamental Investment Ideas: N/A, though the Colombian equity market is currently screening as a candidate on the LONG side.

SIZING UP ASIA & LATIN AMERICA FOR 2013 - COLOMBIA

 

Mexico

  • 2012 Equity Market Performance: +17.9% vs. a regional median gain of +11.7%
  • 2012 FX Performance (vs. USD): +8.5% vs. a regional median gain of +7%
  • 2012 Sovereign Debt Performance (10YR tenor, local currency): -113bps to 5.38%
  • Full-Year 2013 G/I/P Outlook: Quad #2 (faster GROWTH; faster INFLATION)
  • Key Callout for 2013: Our outlook for INFLATION in Mexico is a bit hawkish relative to consensus at the present juncture.
  • Active Fundamental Investment Ideas: N/A, though we continue to expect further gains in the Mexican equity market in anticipation of meaningful economic and fiscal reform.

SIZING UP ASIA & LATIN AMERICA FOR 2013 - MEXICO

 

Peru

  • 2012 Equity Market Performance: +5.9% vs. a regional median gain of +11.7%
  • 2012 FX Performance (vs. USD): +5.4% vs. a regional median gain of +7%
  • 2012 Sovereign Debt Performance (10YR tenor, local currency): N/A
  • Full-Year 2013 G/I/P Outlook: Quad #1 (faster GROWTH; slower INFLATION)
  • Key Callout for 2013: Our outlook for GROWTH in Peru is well above consensus at the present juncture.
  • Active Fundamental Investment Ideas: We have held a bullish bias on the Peruvian equity market (TREND) since DEC 31, 2012.

SIZING UP ASIA & LATIN AMERICA FOR 2013 - PERU

 

Venezuela

  • 2012 Equity Market Performance: +302.8% vs. a regional median gain of +11.7%
  • 2012 FX Performance (vs. USD): N/A
  • 2012 Sovereign Debt Performance (10YR tenor, local currency): N/A
  • Full-Year 2013 G/I/P Outlook: Quad #3 (slower GROWTH; faster INFLATION)
  • Key Callout for 2013: Our outlook for GROWTH in Venezuela is well shy of consensus at the present juncture. Our outlook for INFLATION in Venezuela is well above consensus at the present juncture.
  • Active Fundamental Investment Ideas: N/A, though we continue to see heightened risk of a material devaluation of the Venezuelan bolivar over the intermediate term.

SIZING UP ASIA & LATIN AMERICA FOR 2013 - VENEZUELA

 

Darius Dale

Senior Analyst


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