The Babson Capital Staff Letter - 4th Quarter 2011       (PDF)
January 11, 2012

• Markets: Eurozone headlines drove market performance in the fourth quarter; equities and high yield bonds outperformed higher quality assets
  
• Economic Review: The U.S. displayed a fairly consistent trend of positive economic data in the fourth quarter. Eurozone is now flashing warning signs of recession
  
• Economic Outlook: We remain guarded as we expect continued slow growth in the U.S., with more headwinds from uncertainty in Europe and the threat of a Chinese slowdown

The Babson Capital Staff Letter - 3rd Quarter 2011       (PDF)
October 10, 2011

Greece, a country of nearly 11 million people that comprises 2% of Euro zone GDP, set the dominos in motion to accelerate Europe’s sovereign debt crisis to the point where core members like Spain and Italy face higher funding costs and rising default concerns. Increased globalization of markets allowed contagion fears to rapidly spread across the world leaving both developed and emerging markets investors in a risk aversion mode.

The Babson Capital Staff Letter - 2nd Quarter 2011       (PDF)
July 11, 2011

If we rewind the clock to 2Q10, many of the issues that rattled markets at that time reappeared in 2Q11 as fears of contagion effects and potential default ramifications of Greek debt spooked the markets. In the U.S., any momentum the economy generated from the 3.1% growth rate posted in 4Q10 quickly dissipated as 1Q11 GDP growth checked in at a less than robust 1.9%. Second quarter 2011 returns show the more defensive-oriented mindset taken on by the market.

The Babson Capital Staff Letter - 1st Quarter 2011       (PDF)
April 08, 2011

Investors had some momentum going into 1Q11 as real GDP grew at a 3.1% Q/Q annualized rate in 4Q10 and there were abundant signs the economic recovery was taking hold. It was risk on to start the year until a confluence of natural and geopolitical events arose mid-quarter that caused investors to retreat, only long enough to digest current events and determine improving economic data should rule the day – risk on again.