Betting on a de-sync - VP 2024 Themes (Part 2, December G3 Leading Indicator Watch)

This is part 2 of our 2024 Themes. Part 1, 3 Key (Cyclical) Questions, was posted on December 1st.

• US: consumer is still spending as labor hoarding has given consumers a false sense of job security, yet personal finances are deteriorating. The credit cycle has not gone away and as highlighted in our 1969-70 roadmap, we suspect that once profit margin pressures start to bite, the labor market cracks go from a gradual to a sudden deterioration. 
• China: cyclical risks are to the upside. We acknowledge China has many structural problems that are quickly becoming a feature and not a bug of Chinese assets. But the economy is NOT getting any worse. The pace and cadence of Chinese easing announcements is picking up, with an increasing focus on fiscal and real estate.                                                     
• Eurozone: recession is becoming consensus. It is likely still too early to fade, but there are some anticipatory signs of a rebound in 2024. Watch Sweden as a leading indicator for the Eurozone.