2014: US stocks, bonds and USD to outperform, US growth to quicken to 3%+ annualized

Consensus said:

Investors positive on the US growth story and stocks. Bond markets expect yields to rise as growth picks up and Fed ends QE programme.

We said:

US has rebalanced household debt, dollar and budget deficits. Growth to be driven by pent-up housing & car demand, shale energy, and capex induced by low US costs. Sluggish rest-of-world to provide capital inflows, holding down bond yields, boosting stocks, real estate and, especially, the dollar. (LSR View 11th April 2014)

Outcome:

US stocks strongly up in 2014 to date, long bond yields do not rise in line with market expectations, USD takes off.