First, the EU faces an uncertain economic recovery, prospects for U.S. growth and high unemployment also is not optimistic. However, half of 2010, the U.S. growth exceeded European. Currently, the U.S. tax cuts next two years has passed, I believe the U.S. will be more advantage.

Finally and most importantly, sovereign debt in 2011 still will be a central issue in the forefront. We believe the European sovereign debt problem, outside the euro zone countries will continue to erode, and ripple effects to the core countries. At the same time, we can not rule out the debt and deficit in 2011 will have a negative impact on the U.S. development.

We expect global GDP growth in major developed countries is lower than average, and below the 2010 level. U.S. fiscal stimulus plan to boost U.S. growth, but the euro zone, Japan and the UK level of growth will decline compared with 2010.

Steady growth in emerging market countries. For inflation, emerging market economies will be proper control of policy makers the economic growth. Major emerging market countries will strengthen the management of inflation, but not over-tighten the implementation of the policy.

After inflation, the Federal Reserve and European Central Bank increased interest rates for the first time, it is estimated the first quarter of 2012, the Bank of England raised interest rates for the first time estimated in the third quarter of 2011. Emerging market central banks will carefully slight increase in official interest rates.

On the whole, we will use three words to summarize the global economic situation in 2011 and macroeconomic policy: rebalancing, reflation, policy in collaboration (Rebalancing, Reflation and Reconciliation).

Rebalance the world economy in 2011 will accelerate the process. In China, GDP is expected to grow 9%, more than half of the growth will come from consumer spending. Current account surplus will narrow to 3.6% of GDP. In the U.S., net exports will play a major role in the growth of GDP. For most countries, the external imbalance would improve.

In inflation, the U.S. low inflation, deflation in Japan, Europe, the debt crisis, the major mature economies slow economic recovery, indicating that in 2011 the major developed economies, central banks will continue to increase the money supply. Major economies, interest rates are now close to zero, G3 countries still take the over-loose monetary policy, we believe that the future global economy will experience reflation.

While the global re-balancing and reflation in 2011 to promote global economic and market recovery, but taking into account the government’s debt burden in many countries, the future economic downside risk still exists. Therefore, policy coordination between governments is still essential.

First, the trade will grow unexpectedly. Our view is that the recovery of global trade emerging market countries and developed market countries is beneficial. But also the risks to global economic growth increased. Concern that the global trade and the manufacturing industry between China and Germany. China and Germany manufacturing survey, the two economies are well adapted to the global trade cycle.

Secondly, all the liquidity will do. Our view is: the future inflation will remain modest, the cumulative risk with time delay. Concern is that excess liquidity. M1 money supply in nominal GDP, accounts can be used to express the degree of consumer prices were depressed.

Again, the sovereign debt crisis will infect it? Our view is that sovereign debt crisis is far from over, and now is outside the euro zone countries from the national to the center spread. Possible future across the Atlantic, spread to a wider context. Worthy of the market concerned, is the major euro area countries the financial and budgetary system will merge.

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