Morgan Stanley's Global Strategy team is out with its 2014 outlook titled: Fertile Soils, Rising Divergences.
In it, Morgan Stanley says that they generally favor stocks over bonds, but that we're now in the second half of this big boom, and that future gains will now depend more on growth, as opposed to liquidity.
This is a similar idea as that expressed by Nomura, which argued that the end of "end of the world risk" would require a search for real growth, rather than just gains brought on by climbing out of the gutter.
Here are Morgan Stanley's 10 big macro strategy ideas. These are their words:
-- European Equities: Long Financials (SX7P, SXIP); Short Cyclicals (SXNP, SXPP, SX4P)
-- Asia Equities: Long Nikkei, HSCEI, Kospi, Taiex; Short CNX Nifty, JCI, SET, FBMKLCI, FSSTI
-- US equities: Healthcare over Staples; Tech over Discretionary; Chemicals over Industrials and Energy
-- Long US credit versus European Credit (Long US CDX HY versus Short iTraxx XOver)
-- Long USD interest rate volatility (Long 2y10y swaption straddles)
-- Long Spain over Italy sovereign bonds (10y Bonos versus BTPs)
-- Long US IG long-duration discount bonds versus UST
-- Short EM sovereign credit (Short EM CDX)
-- Long new-issue CLO equity
-- Long USDJPY, Long USDRUB