Mid-Year Outlooks

+ Louis-Vincent Gave, Man, Apollo, Vincent Deluard, Goldman Sachs & More

Author

The Idea Farm
July 06, 2025

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“Time is the friend of the wonderful company, the enemy of the mediocre.”

— Warren Buffett

Research

While the political will to cut the deficit is lacking, Ulrike Hoffmann-Burchardi explains why she believes the US debt burden remains manageable and that growth is the best option for the US to reduce the deficit over time.

Allianz Chief Economist Ludovic Subran covers the ceasefire agreement in the Middle East, the state of Europe’s defense push, and their country and sector risk update, which signals a shift in global economic resilience from high-income to emerging economies. Two interesting facts:

  • In 2023, nearly 42% of European defense budgets were absorbed by personnel costs.

  • Ukraine still imported 95% of its drones from China in Q1 2025

While trend following has had a tough start to 2025, Man Group explains why historically, those who have stayed the course have benefitted.

Assuming that the US is folding its security umbrella and withdrawing from patrolling the world’s ocean, Louis-Vincent Gave looks at possible winners and losers. He notes most of the winners in that scenario are trading at average or below average valuations.

Mid-Year Outlooks

Looking to the second half of 2025, Apollo sees slower growth, higher inflation, and interest rates staying higher for longer. While they don’t foresee a recession, they do expect headwinds on both supply and demand fronts.

At the halfway point of 2025, GSAM highlights key investment themes and potential strategies to navigate heightened economic, geopolitical, and market uncertainties.

Source: Goldman Sachs Asset Management. As of June 2025.

This outlook highlights the importance of regional stock diversification and income strategies, why alternative investments should be used for for alternative risks, why awareness of your currency exposure is important, and more.

Capital Group - Long-term perspective on markets and economies (20 pages)

Capital Group walks through a number of investment themes they’re excited about today: dividend growers, international innovators, Japan, munis and corporate bonds, and more.

Sources: (Left chart:) Capital Group, Compustat, MSCI, Worldscope. Data from December 31, 1989, through December 31, 2024.

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Podcasts

6/20/2025 - 28 minutes

StoneX’s Vincent Deluard explains why, in a US economy based on intangibles and the seemingly constant stimulus of government spending, downturns are both less common and more shallow than they used to be.

6/24/2025 - 24 minutes

Goldman Sachs examines the dynamics driving markets now, and discuss the investment strategies that could work in the second half of 2025.

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