One word you certainly cannot associate with the global economic recovery in 2015 is 'synchronised'

One word you certainly cannot associate with the global economic recovery in 2015 is 'synchronised'. The US economy is revving strongly, but China appears to be moderating in a structural way and the recoveries in Japan, Europe and Australia look patchy at best. Although investors normally associate weak economies with weak earnings and declining sharemarkets, the key rule this year I think is to follow the stimulus while keeping an eye on valuations. The Australian economy this year looks reasonably soft and RBA rate cuts and the lower exchange rate are likely to provide only a modest boost to growth given the state of household balance sheets. More importantly, it is very hard to find compelling value in the Australian sharemarket as many companies are seemingly priced for perfection, particularly in the defensive sectors such as banks and healthcare. While stimulus will provide some growth delta, valuations are the ultimate driver of long-run returns and investors need to be careful about following the herd and paying too much for an asset.