I hope you enjoy today’s insightful post from my colleague Peter Essele. See you next week! — Brad

“What will the market return this year?” As a portfolio manager, I hear some variation of this question at the beginning of each and every calendar year. Following the requisite exchange of pleasantries, it inevitably comes up at cocktail parties, birthday get-togethers, client meetings, and even the après-ski scene.

After analyzing China, Japan, Brazil, and other economic powers around the world, we come at last to the U.S. An outside view is particularly useful here. As citizens, we tend to think we know all the details, and so we're all the more likely to be caught up in an inside view.

The benefit of looking at the other countries first is that we now have some context for judging where we stand and what that might mean. 

As I mentioned yesterday, Russia’s economy basically doesn’t work without oil. Today we’ll take a deeper look at that problem, along with the potential consequences as Russia attempts to deal with it.

I wrote yesterday about what I see as the two major domestic risks to the U.S. economic recovery, neither of which is worth worrying about too much. The two immediate risks we should be thinking about originate outside the U.S.: the standoff between Germany and Greece, and the confrontation between Europe and Russia.

As I mentioned in my post about the latest employment numbers, I’ve been focusing quite a bit on all of the good things happening for the U.S. economy. But that doesn't mean I'm not paying attention to potential threats. 

Let’s take a look at a couple of economic risks the U.S. faces.

When I give talks or interviews, I’m often perceived as bullish on the U.S. recovery. In my own view, though, I’m neither bullish nor bearish, but simply driven by the data.

Others see it differently, especially when it comes to the employment story. Just this past week, the chairman of Gallup wrote a column titled “The Big Lie: 5.6% Unemployment.” After seeing that piece, several readers reached out to question what they see as my optimism, asking, in effect, Really? Can things really be that good?

As we discussed yesterday, Brazil is different from the developed economies in Europe, Japan, and even China, and it presents a different kind of opportunity for investors. With an economy halfway between those of Brazil and China, and a set of advantages that both other countries lack, India is potentially an even more interesting opportunity.

Since it's a fairly quiet news day, I want to return to our "outside view" series on countries that matter around the world. So far, we’ve considered China, Europe, and Japan, but today we’ll shift gears and look at a very different country, Brazil.

In my latest Market Thoughts video, I discuss the ongoing U.S. economic recovery, the difficult month U.S. financial markets just experienced, and changes in the global markets.

Once again, it’s time for our monthly update on risk factors that have proven to be good indicators of economic trouble ahead. As expected, the data hasn’t changed much from last month—it remains positive in almost all areas and has continued to improve in many cases—but it’s still important to keep an eye on things.

As we move into the year, though, the economic forecast remains bright.