Global Macroeconomic Overview - In 2025, global economic growth is expected to stabilize at approximately 3.2%, with the IMF projecting little difference from 2024. The resilience is attributed to tariff impacts being offset by imports and AI investments [1][10] - Economic differentiation is evident, with the US experiencing a decline in growth, while Europe and Japan show slight rebounds, and emerging markets maintain resilient growth [1][10] - Inflation and monetary policies are diverging, with a general trend towards easing; the Eurozone is expected to cut rates in the first half of the year, while the US is anticipated to lower rates in the second half [1][10] - Tariff disruptions have led to significant changes in trade environments, with a normalization expected in the latter half of the year [1][10] - The AI industry is expected to see increased capital expenditure, contributing to global trade growth and strong demand for non-ferrous metals [1][10] Global Asset Pricing Understanding - A stable growth environment and loose fiscal and monetary policies in major economies create opportunities for risk assets, with commodities and stocks showing high returns [2][14] - The decline in the dollar's asset yield due to US rate cuts and increased credit risk premiums from tariffs are key factors driving the dollar's weakness, influencing asset pricing [2][14] - Emerging markets exhibit relative growth resilience, benefiting from capital reallocation away from dollar assets [2][14] - The narrative surrounding AI's industrial fundamentals and global supply chain restructuring, combined with favorable liquidity conditions, creates a strong pricing narrative [2][14] US Economic Outlook for 2026 - The US economy is expected to experience a "strong then stable" trajectory, with GDP growth projected at around 2.4%, slightly above market expectations of 2.1% [5][29] - The first half of 2026 may see growth spike to approximately 3% due to the impact of tax cuts and government spending recovery, followed by a decline to around 2% in the latter half [5][29] - Consumer spending is anticipated to grow by 2.1%, supported by tax cuts and tariff rebates, although K-shaped recovery characteristics are noted [5][29] - Corporate fixed investment is projected to grow by about 5%, driven by systematic reductions in capital costs from tax reforms and ongoing AI infrastructure investments [5][29] US Monetary Policy Changes - The nomination of Warsh as the next Federal Reserve Chair signals a potential systemic shift in US macroeconomic policy, focusing on regulatory reforms to enhance private sector credit expansion [6][35] - This new framework aims to achieve a balance between Fed balance sheet reduction and credit easing, potentially leading to a decline in the Fed's balance sheet relative to GDP without triggering a liquidity crisis [6][35] Non-US Economic Conditions - Japan's fiscal policy is shifting towards a growth-oriented approach, with GDP growth expected at 0.6% in 2026 [7][41] - The Eurozone is projected to maintain weak recovery, with GDP growth anticipated at 1.3%, supported by fiscal expansion and resilient consumption [7][41] - Emerging markets are expected to see moderate growth, with significant regional differentiation; India is projected to maintain a growth rate of 6.4% driven by domestic demand [7][41] Geopolitical Environment - The global geopolitical landscape in 2026 faces challenges from the US's "transactional diplomacy," with significant developments in Latin America, Europe, and the Middle East [8][46] - The US is redefining its resource control in Latin America, while the Russia-Ukraine conflict is moving towards a ceasefire, impacting asset pricing related to geopolitical risks [8][46]