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— Emma Du Haney, Henderson Global Investors

Corporate bonds, particularly the higher quality investment grade ones, look cheap on any historical measure. In the UK, investment grade financial sector bonds are trading at levels that indicate that one in five banks will go bust in the next five years.

— Cormac Weldon, Threadneedle

The US economy has now been slowing for some time and there are mounting fears of a recession. However, we believe that by the end of 2008 the economy could already be on course for a recovery, as the lagged effects of the recent action by the Federal Reserve and the proposed fiscal stimulus package from the Bush administration feed through.

— Urban Larson, Latin America Equity Fund, F&C

Despite current market volatility, economic growth across Latin America is still strong and the region remains attractive for investors across the globe. Both public and private sectors have very ungeared balance sheets, while the region as a whole continues to run a current account surplus.

— John Su, Goodman Property Investors

As concerns continue to grow around the US economy and European property market returns slow, Asian property markets will increasingly be seen as an alternative destination for western investors.

— Alice Breheny, Henderson Global Investors, Property

Following the credit crunch of 2007, many parts of the European property market saw some correction during the latter half of the year, with secondary property taking the biggest hit. While higher yields present a buying opportunity, investors are now likely to take a more cautious approach to acquisition.

— Tracey Lander, Old Mutual Asset Managers (UK)

The US economy remains fragile as housing sector weakness feeds through to consumer sentiment and spending. It now seems likely that economic growth will slow, inevitably impacting profits growth.

— Dr. Jerome Booth, Ashmore Investment Management

In the US the focus is on the subprime debt and credit crunch woes and the course of interest rates and possible stagflation. The outlook is more benign however for Latin American economies and markets, as for emerging markets generally.

— James Weir, Atlantis Asian Special Situations Fund

In our view, Asia is exceptionally well positioned to outperform despite a G7 economic slowdown. The post-1997 financial rebuilding of the region is now beginning to bear fruit. In contrast to the G7 economies, balance sheets are in good shape at the sovereign, company and household levels, allowing reinvestment to drive future growth.

— Rick Lacaille, State Street Global Advisors

After a three-year bull run, European markets have been hit by volatility and multiple corrections and equities are now 25 per cent lower than their summer 2007 highs. The catalyst for this volatility has been the deterioration in credit markets and concerns over US subprime lending.

— Cormac Weldon, Threadneedle

We find ourselves at a crossroads. With the things that we thought would do well in 2007 having done very well, and the parts of the market we avoided having been sold off, we are close to needing to make big changes to our strategy.

— Urban Larson, Latin America Equity Fund

Latin American markets have been very volatile year-to-date, in sympathy with global equity markets. However, economic growth across the region is strong, with inflation in some countries close to record lows.

— John Cleary, Focus Capital

Asia will become the world’s dominant economic region in this century. The Asian Development Bank estimates that in 2007 and 2008 alone, growth in the region will exceed 8 per cent, ahead of most countries in the rest of the world. So what are the factors behind this?

The second half of 2007 has been volatile for international equity markets – primarily a result of the turmoil in global credit markets. This retreat from risk has seen liquidity drain from credit markets and resulted in the worst global credit squeeze since 1998.

Two issues need addressing in the current US market: the first is whether we are heading towards a recessionary environment. We have seen one of the worst housing markets since the Great Depression and it is likely this downturn will persist next year.

— Katy Dobson, Threadneedle Latin America Fund

It has always been assumed that the economic fortunes of Latin America are intertwined with the US. According to data from the World Trade Organisation, North America is the major trading partner of South and Central America, absorbing 33 per cent of its exports and supplying 29 per cent of its imports. The region would therefore appear to be vulnerable to the slowdown in US growth forecast for 2008.

— Greg Kuhnert, Investec Asset Management

Asia ex-Japan has returned 37 per cent this year (in US dollars), and 255 per cent since the start of the bull market in March 2003. With clouds gathering on the global economic horizon – attributable in part to weakness in the US housing market and the sub-prime crises - and Asian equity valuations trading at a premium to global equities, investors are justifiably cautious in the near term.

— Jerome Booth, Ashmore Investment Management

The countries in the emerging world with fiscal and current account imbalances are a combination of a few making little progress, those coming from much worse imbalances (such as Turkey) and some of those which are becoming developed through having joined the EU, in particular Hungary and Romania.

— Francois Moute, ABN Amro Funds

US equity markets have enjoyed a substantial rebound in recent weeks, pushing indices to all-time highs. But the evidence of an economic slowdown has yet to recede: growth projections have been revised downwards, the US housing market continues to decline and credit markets have not recovered.

— Gonzalo Pangaro, T. Rowe Price

Following a steep downturn sparked by this summer’s global credit crunch, Latin American stocks have staged a strong comeback.

— Kyu Eun Jeong, Atlantis Korea Opportunities Fund

Emerging markets have continued to see strong inflows from overseas investors in 2007 in spite of this summer’s credit crunch. However, one market that appears to have been overlooked by these foreign investors is Korea.

— David Karsboel, Saxo Bank

In the past months, markets have been hit by worries about the US subprime mortgage exposure in the financial system. In our view, the subprime and credit turmoil has been correctly diagnosed as a problem that is not contained and it will continue for at least 18 months from now. It may even take 24-36 months to resolve in Europe.

— Jeremy Baskin, Northern Trust Global Investments

As September closed, returns for most US equity indices for the quarter were positive. Returns year-to-date are reasonably robust, with some sectors (mid- and large-cap growth) reaching double-digits. This belies the volatility of July and August, a shock for market participants, with particular impact on quantitatively-managed strategies.

— Maarten-Jan Bakkum, ABN Amro Asset Management

Mexico is a market with two faces. On the one hand, with 85 per cent of its exports sold in the US, it is probably one of the economies most exposed to a sharp slowdown in US consumer demand. On the other hand, it is one of the most dynamic economies in the world, seeing heavy investment in infrastructure, strong credit growth and an exciting reform momentum.

— Peter Dalgliesh, Pacific Assets Trust&Management

Emerging market giant China, the economic engine of the Asia-Pacific region, continues to offer investors compelling investment opportunities. The country’s equity market has been assisted by very strong corporate earnings growth, faster-than-expected GDP growth and negative real interest rates, creating an abundance of liquidity.

— Susanne Willumsen, State Street Global Advisors

Ongoing credit and liquidity issues are likely to continue to generate uncertainty in financial markets, particularly in relation to risk appetite, potential financial losses and the economic growth outlook.

— Robert N. Streed, Northern Trust Global Investments

In a stock market where prices have been advancing for some time, investors often look back and say: “I wish I bought this stock back when it was trading at…” We believe the market is entering the “back when” period which investors will be pointing to in coming years.

— John Cleary, Focus Capital

Latin America is broadly doing better than at any time since the mid 1970s. The region is in its fourth successive year of economic growth, which is averaging 5 per cent, while inflation remains in the low single digits.

— Jan de Bruijn, Asian equity, Threadneedle

It is still too early to have a totally clear picture of what the impact of the current credit crunch will be on Asia in macro terms.

Though a level of stability has returned to the markets (although the sharp rebound in itself reflects the increased volatility), no one is yet clear as to what the actual losses will be or who will be left “holding the baby”.

— Nigel Hankin, Investec Asset Management’s European Funds

In May, European equity markets (at least as measured by the MSCI) finally surpassed levels not seen since the height of the last bull market in 2000. That the losses of the bear market had finally been recouped seems an occasion for no small celebration and yet it passed largely unremarked.

— Robert W. Sharps, T. Rowe Price

A benign economic backdrop and the strong health of the US corporate sector are likely to continue to underpin positive equity market sentiment. Although moderating, we expect the US economic cycle to achieve a trend rate of growth through the rest of the year.

— Pedro Villani, ABN Amro Funds – Brazil Equity Fund

In Brazil, environmental, social and corporate governance (ESG) criteria are increasingly perceived by all stakeholders, including investors, as an important ingredient to corporate success.

— Dr. Jerome Booth, Ashmore Investment Management

Ten years after the Asian crisis, emerging markets are net creditors. This build up has been at the cost of foregone domestic investment. Reserves have been channelled into US Treasuries and other G7 bonds,

yielding less than returns on domestic investments.

— Karin van der Sluijs, Arlington

Over recent years there has been significant growth in the indirect property investment market. The largest European funds own upwards of €5bn of assets, with minimum investment levels from €100,000.

— Cormac Weldon, Threadneedle Investments

Why should investors continue to back US equities when they have delivered only lacklustre performance in global terms in the last few years?

Latin American stocks have resumed their ascent in a four-year rally that has yet to run out of steam. Benchmarks in Brazil and Mexico jumped to record levels in mid-May, making them among the world’s best-performing markets so far this year.

— BP Singh, Atlantis Investment Management

As in recent years, the Indian economy ended Q1 2007 on a strong positive note, with the key macro factors of globalisation, favourable demographics and economic reform leading to buoyant economic data and strong corporate earnings.

As the European Union has expanded eastwards, the line between what is considered high yield and emerging market debt has begun to break down. What was once solely considered the domain of macro economic emerging market analysis, is now increasingly in the sights of dedicated European high yield specialists.

— Francois Mouté, ABN AMRO Funds-US Opportunities Fund

A slowdown in the US economic cycle is not, on the face of it, a positive environment for US equities. But US companies with substantial exposure to robust growth elsewhere are expected to enjoy strong returns in 2007.

— Urban Larson, F&C Emerging Equities

Latin America continues to offer opportunities to international and domestic investors in equities, despite growing signs of a slowdown in the US.

— Nick Beecroft, Japanese Equity

The global equity sell-off at the end of February served as a reminder of the potential threat arising from a significant global slowdown or a sudden reduction in risk appetite.

Look around and you might think that inflation in the euro-zone is about to rear its head. The economy grew at a stellar 3.6 per cent annualised real rate in the fourth quarter of last year and some of Germany’s trade unions are indeed demanding hefty wage increases after years of restraint.

Over the past several months, the US economy has flip-flopped between fears of increased inflation on one hand and signs of economic slowdown on the other.

Latin America remains a continent with some compelling reasons to invest. Economic growth rates, which are often a stimulus for higher investment returns, are well above OECD averages.

The Asian bulls will argue that the multitude of factors that is leading to the re-rating of Asian equities remain firmly on course. As a result, the 8 per cent discount of Asian equities relative to global equities ought to reduce.

— Williams: US slowdown may hit export sectors

After another 20 per cent returning year in European markets, then, at time of writing, a 6 per cent pullback, which is the right direction for this market?

— Para: Fed should not raise interest rates

Last quarter US Treasury yields traded within a 40 basis point range. The threat of inflation countered the threat from a slowing housing market, keeping Treasury yields relatively range-bound.

— Booth: ‘Venezuela can afford to gamble’

Structural reforms have been lacklustre of late but macro-economic balances have turned dramatically positive. Second generation fiscal reforms to increase expenditure efficiency, help deliver public goods and encourage private investment are lacking, with de-politicisation of judicial systems particularly important.

One leading property consultant predicted early last year that global direct commercial real estate investment could reach $600bn (€456bn) in 2006. This estimation is turning out to be a fairly accurate prognosis given the total investment amount in the first six months of the year totalled $290bn.

— Fowler: private equity firms using cheap debt

The European economy is likely to show continued strength this year, although at more moderate levels than in 2006, supported by economic growth in China and other emerging markets.

— Weldon: lowe rates can be expected

The recent resilience of the US economy is most encouraging. Many market observers had assumed that the combination of high energy costs and inventory-build in the housing market would trigger a sharp deceleration of GDP growth in 2007.

— Alia Yousef

Today’s emerging market bonds emerged as an asset class in Latin America in the late1980s/early-1990s when the then Treasury secretary Nicholas Brady nudged a number of countries south of the US to consider voluntary debt restructuring packages.

— Jeong: domestic recovery anticipated

The Korean market was a laggard in 2006 compared with other Asian markets, especially China and India. Whilst the China A and B share indices more than doubled in 2006 and the H shares index increased by 94 per cent, the Kospi was only up by 4 per cent, while the Kosdaq fell 13.6 per cent, both in Korean Won terms.

Strong economic growth and increasing investor demand is continuing to drive high returns in the European property market. However, yields are being driven lower as supply of new property fails to keep up with buoyant investor demand.

— Ayres: consumer spending still strong

After a difficult spring and early summer, equity markets in the US have recovered since June. This move has been characterised by the continued outperformance of value over growth styles across capitalisations.

Latin American equity markets remain rather heterogeneous. Where Brazil is driven mainly by rising raw material prices and falling local interest rates, the other large market, Mexico, is propelled chiefly by rapidly growing workers’ remittances and consumer credit growth.

— Parks: prospects positive for Asia

With the consensus now moving towards the idea of a soft landing for the US economy, the prospect of falling US interest rates along with lower but still positive growth has emerged.

— Iggo: a global recession looks unlikely

Despite strong economic growth so far in 2006, a number of business surveys and economic forecasters are looking for a slowdown in the major eurozone economies in 2007.

— Lander: record levels of M&A activity

With US markets trading at near-record levels, investors are wondering whether the recent strong run can continue, despite evidence of a slowing economy. From an economic viewpoint, we believe that there is certainly scope for equities to make further progress.

— Reynal: dire outlook for electricity generation

The 2006 Mexican presidential elections will long be remembered for the closeness of the vote, the bitterness of the post election legal fight, and the mutual antagonism of the candidates.

— Davis: North Korea poses a wild card

Overall, we remain positive on Asia given solid economic growth prospects and valuations that remain attractive relative to those of developed markets. With global growth slowing however, Asia is no longer a one-way bet.

— Wallington: fears have driven up market

Investing in Europe in the last two years has been a question of ignoring the popular Anglo Saxon cant on the region. The general market level suggests acceptable returns, the 2007 price/earnings ratio forecast of 12.5x implies a real return of over 7 per cent and to this we can add a decent prospective dividend yield of 3.3 per cent.

— Probyn: we predict a soft landing

The US economy is currently shifting gears, making the short-term outlook particularly uncertain. After a robust expansion that lowered the unemployment rate steadily over the last three years, growth is poised to slow. The all-important question is, of course, by how much?

— Dobson: Brazil goes to a second round

This summer, no equity region has tested the mettle of investors as sorely as Latin America. But while stock prices have fluctuated wildly in reaction to news on global economic growth, US interest rates and commodity prices, essentially nothing within Latin America has changed. Both the internal and external environment remain extremely positive.

— Dowds: tightening taken form of constraints

Forecasts for economic growth in Asia have been under scrutiny in the recent past as investors consider the impact of both domestic tightening measures undertaken in two of the larger economies, namely China and Japan.

— Jones: opinions are very divided

Equities around the world endured a volatile period over the first half of 2006. The year began well, with most major markets registering consistent advances, supported by solid economic growth, healthy corporate earnings and high levels of merger and acquisition activity. However, rising US inflation raised concerns that further US interest rate rises would affect world economic growth.

— Knight: US competitive edge may fade

It is amazing how many metaphorical parallels there are between sports and capital markets. Books like Michael Lewis’ Moneyball and Sam Walker’s Fantasyland typically show up on finance professionals’ summer reading lists because of the lessons one can draw and apply to the investment landscape.

At the beginning of the year, we identified the electoral cycle as the main risk for Latin American markets in 2006, and indeed we have witnessed some difficult events, such as the re-nationalisation of the energy industry in Bolivia by recently elected President Evo Morales.

— Weston: close links between two economies

A mantra long familiar to investors in non-Japan Asia is that of the region ‘decoupling’ from the rest of the world. This means that Asia has ‘grown up’ enough, both economically and politically, to become a self-reliant and self-sustaining entity, no longer dependent on the whims of Western consumers (especially the US) for economic growth.

— Eckhert: demand for hybrids is non-existent

Global reflation is becoming the dominant factor driving bond yields up. Those investors who expected disinflationary conditions (which have been positive for bonds) to persist got caught on the wrong foot. Economic growth around the world has picked up and rising commodity prices have led to increased inflation expectations.

After posting gains in five of the six past calendar years, while outperforming stocks by a substantial margin, commodities have recently encountered turbulence, falling about 10 per cent between mid-May and mid-June.

— Newman: improvements at company level

During the 1980s and 1990s, the reputation of South America as a place to invest in was arguably at a historic low. Today, the economic fortunes of the region have turned around so much; investors now see Latin America as an integral part of their investment strategies.

For the first time in the recent history of the bull run in the Indian markets, we have witnessed a sharp correction, with the Mumbai Sensex falling by 30.55 per cent after touching a high of 12,671 on 11 May to a low of 8799 on 14 June.

— Tony Dolphin,Henderson Global Investors

After months of consecutive rises, many major equity markets throughout the world fell sharply in May. Because the falls were primarily a result of nervous investor sentiment rather than deteriorating fundamentals, the size of the falls came as a surprise to many market participants.

As US Federal Reserve chairman Ben Bernanke assumes his role as successor to Alan Greenspan, he also faces the re-emergence of volatility in global markets.

— Mile Reynal,Principal Global Investors

The recent sell off in Latin American equity markets was largely triggered by fears of further rate hikes by the Federal Reserve in the US. However, investors must now beware a rollover in commodity markets, a pick up in risk aversion, and perhaps most importantly, the risks around the electoral cycle.

— Jerome Booth, Ashmore Investment Management

Most of the major risks in the global economy emanate from structural imbalances in the developed world, not in the emerging world. More than that, the very definition of being an emerging country may be construed as conveying some protection as what risk exists is already priced in (and often significantly over-compensated for).

The European economy has emerged from a lacklustre period and recent data suggests that the region’s economy is booming. But one of the longer term barriers to growth in Europe remains structural economic inefficiencies.

The US outlook is all about the property market, which has been the wind beneath consumers’ wings this decade. Housing price wealth effects and mortgage equity withdrawal have allowed the US consumer to go on an unparalleled spending spree which has made US growth look much healthier than it is.

The stellar outperformance of Latin America continues. In the three years to the end of March, the region has delivered a local currency gain of 232 per cent – which is around twice that of most leading markets. But can the bandwagon continue to roll?

It is difficult to be negative about Asian equities this year in the face of current conditions. The global economy is growing at a steady clip, while economists continue to enthusiastically revise up growth estimates.

— Colglazier: Orange promises failed to deliver

It is nearly a year and a half ago when the world watched as thousands of Ukrainians descended upon the capital’s Independence Square dressed in orange. Outraged by the rigging of the presidential elections, the citizens rallied against the government to overturn the results.

— Hall: US is too appealing to ignore

The US market has enjoyed its strongest first quarter returns since 1998. Can we expect this trend to continue? Over the past two years global equity markets have enjoyed bumper returns while the US has played Cinderella, largely missing out on the equity party.

— Bakkum: strong capital inflows to Brazil

High commodity prices and the rapid integration of Brazil in the