U.S. Growth Stronger Than GDP Suggest: Burgess

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June 9 (Bloomberg) -- Hussein Kanji, Chief Investment Officer at Threadneedle Asset Management, discusses the impact of monetary policy on volatility, growth in the U.S., and his subsequent investing strategy. He speaks with Guy Johnson on Bloomberg Television’s “On The Move.” (Source: Bloomberg)

It is down as much as it is?

I know we have been as low as 10, but we are getting too low levels.

Read between the lines for me.

I think it's a reflection of the amount of liquidity we have got in the system.

He heard the ecb saying they are going to fight.

We have ongoing qe around the world.

I think that is a function driving volatility down.

From an asset point of view, what do we do?

I think we have to keep an eye on it.

In the past we have had a fairly unpleasant experience.

I think it's something we have to pay extra attention to.

I think it's low interest rates, liquidity, and investor confidence.

Just looking at how you have got the market broken at the moment, if you were to look at what you don't like, is there a chance we could be thinking of central banks are buying guppies we should be buying them?

Or do you think the price is wrong?

The price is rigged.

Whether it is wrong we will find out, but it is certainly rigged because there is a dominant buyer affecting the price.

Clearly they are going to be in the market for some time.

They are going to be the dominant buyer.

We don't know where the ecb is going, but let's assume at some point they have to step in and make it new qe.

How do i keep that as part of my portfolio?

Do i need to keep it as part of my portfolio?

Roasted we will have some credit in the mix.

-- mostly we will have some credit in the mix.

How should i view it?

If growth picks up the rates will go up, but there is an argument given the debt overhang we are going to be lower for longer, in which case government bonds aren't necessarily expensive.

They might not be going up very much.

The key is whether we get a pickup in growth, and that is where investors are focusing their attention.

You like the dollar.

I think it is about the growth premium.

I think that is why we are invested.

In terms of where the fed is going, are you concerned about the data coming up?

The fact they may slow the rates at which the fed is going to be tightening?

They are taking the rate cut quite significantly.

Probably most of what we look at, it is the gdp number.

They are pointing at a much better story.

The data would suggest growth is more robust than the gdp number would tell you.

To come full-service you talked about the fact that when we got to these levels in the past we have had shocks.

Your expectation would be we would see a negative shock.

If you were to handicap the chances of seeing a negative 10% drawdown between now and the end of the year, is that going to happen?

We haven't seen it in sometime.

If rates stay at this level i think you are as likely to see a rally in the equity market because of the discount rate.

Assets will be affected by the low rates.

It is more likely to be down than up.

It is fairly even.

The one thing you know is central banks will step in if they see a problem.

They remain concerned by what it might mean for markets.

You are likely to see a rally as of fall.

Thank you for joining us.

Here is what else we are looking at.

Details coming up.

Putin comes to the table.

The russian president calls for

This text has been automatically generated. It may not be 100% accurate.


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