GARY SHILLING: Here Are 10 Ways To Invest In The 'Grand Disconnect'
He thinks we have at least another five years of deleveraging ahead of us, and until this era is done he expects average real GDP growth to be about 2 percent.
At the same time investors are fixated on easy monetary policy. But this only has a temporary impact on stocks.
"This Grand Disconnect between robust security markets and subdued at best economic reality, combined with central bank-set low interest rates, has spawned many distortions and a zeal for yield that almost completely ignores financial risks," according to Shilling.
Considering this, Shilling believes it is 'risk on' in 2013, but he cautions that his investment themes could "change dramatically" as the year progresses.
We drew on A. Gary Shilling's Insights to walk through Shilling's investment themes for the years.
We also added a bonus slide in which he points out the success and failures of his 2012 investment themes.
*Note: We corrected the time period for deleveraging.