An uneasy endeavour: Assessing allocating to Europe

Allocating to Europe remains an uneasy endeavour. Global deleveraging and economic dispersion between EU member states have pushed the Maastricht framework to breaking point. Furthermore, we have seen the bond markets force the hands of policymakers’ due to the latter’s inertia. By way of comparison, despite some questions around US growth rates, investors remain less anxious about that economy, primarily because the authorities took early action to resolve the crisis, and the banks constitute a smaller percentage of GDP than in Europe. The market also understands that the debt-carryi...