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Market analysis and strategies

Midyear Market Update

In today's rapidly shifting global economy, making well-informed investment choices depends on understanding the pace of change. Merrill Lynch economists offer smart suggestions for identifying — and taking advantage of — the potential opportunities.

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The shift away from a U.S.-centric global economy could open up a world of investment choices, according to top Merrill Lynch economists and strategists. But approach them deliberately. For more timely market insights from leading figures in the fields of investing, politics and industry, visit the special Smart Solutions Web site.

In assessing the current state of the U.S. economy, the mood has turned decidedly somber. And though many economists are convinced that today's troubles are merely part of the normal economic cycle, Merrill Lynch strategists caution that this time it may be different.

A deliberate approach to investing — along with a keen eye for overlooked opportunities — is what's required now. That's the consensus view of a group of Merrill Lynch's top economists and strategists who recently gathered to take stock of the first half of 2008 and to talk about what may lie ahead for investors.

Smart Solutions: Looking to Latin America

Many countries there have benefited from the surge in commodities prices and stronger fiscal policies. Are they positioned for long-term growth?

Smart solutions: Looking to Latin America

If you want to understand Latin America’s quiet but dramatic turnaround, look no farther than Brazil, where surging commodities prices and savvy fiscal policy have driven a newfound prosperity mirrored throughout most of the region. Newly minted as a net creditor, Brazil is enjoying its second straight year of 5% GDP growth and recently received a coveted Standard & Poor’s investment-grade rating on its sovereign overseas debt. It is even planning its own sovereign wealth fund to help see to the ongoing health of its currency.

But Brazil is by no means the region’s only success story. In fact, the MSCI Emerging Markets Latin America Index of regional stocks has risen eightfold since September 2002. These are impressive developments in a part of the world that has often been historically marked by economic volatility. The question for U.S. investors is, can Latin America continue to provide investors with opportunities for solid growth? According to Felipe Illanes, Merrill Lynch Lead Economist for Latin America, the answer is yes.

World-Class research and experts

When Will Global Financials Rebound?

Chief Investment Strategist Richard Bernstein discusses the latest Research Investment Committee report, which looks at global financial stocks — a sector under stress — and analyzes when a recovery might take place.

Richard Berstein, Merrill Lynch Chief Investment Strategist

This month's RIC Report looks at global financial stocks, a sector under stress. Some Wall Street experts expect the sector to recover once housing prices stabilize. But Bernstein notes that housing can't stabilize until the global credit crisis abates, and that can't happen until the financial sector recovers — it's a classic "Catch-22."

So, when might that recovery take place? The RIC committee feels that it will only occur after governmental intervention in the U.S., as well as greater global consolidation within the sector. Until then, Bernstein counsels investors not to overweight financial stocks. In time, patience will be rewarded.

Every month, the Research Investment Committee (RIC), led by Chief Investment Strategist Richard Bernstein, meets to provide clients with a thoughtful analysis of key issues that drive U.S. and global economies and generate the RIC Report. Each report offers Merrill Lynch clients a wealth of actionable ideas to discuss with their Financial Advisors.

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SMART SOLUTIONS: Investment Ideas for Challenging Times

Even in today's economy, there are always smart places for your money. Listen to the experts in this special video series. Then start a conversation with your Financial Advisor.

Welcome to this special Smart Solutions series, featuring some of the brightest minds in investing, politics and industry. Here they share their unique perspectives on preserving wealth and pursuing growth in today’s markets. Each video below is filled with actionable ideas to discuss with your Financial Advisor, who can help you keep your goals on track.

View The Program