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Stay nimble, flexible in late cycle rebound

The maturity of the cycle, residual geopolitical risks and some crowded positions across asset classes raise the prospect of intermittent bouts of headline and intra-market volatility in 2020.

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Geopolitics represent both risk and opportunity. Brexit and the US/China trade standoff were the headline geopolitical stories of 2019. However, the probability of a worst case scenario on both issues has clearly diminished.

THE global economy stands at an important late cycle inflection point. But late cycle does not mean end cycle. We continue to view short-term recession fears as overdone.

Rather, we expect a moderate growth reacceleration in early 2020 as geopolitical risks abate, China's growth slowdown...