Markets are off considerably from their highs in early mid January with the S&P now trading down about 6 or 7 per cent from the highs of 1,150 found at the beginning of this year and in the short-term, there's clearly a lot to worry about. The markets are concerned about what's happening in Greece, concerned about the knock-on effect and potential for contagion in Portugal, Spain and the likes and we see that in CDS pricing. And so on and in the very near term, the next week or two, further weakness is clearly possible.

But what's interesting I think is for medium-term investors, this is a time to start thinking about adding and starting to build overweight positions in equities and we say that for two key reasons. Firstly, our indicators on the medium-term have gone from a clear sell signal at the beginning of January. We had a sell off indicator signal warning of a wave of risk aversion at the beginning of January. We had sells on medium-term risk appetite gauges and so on. Those indicators have now got back to a position where they're starting to flag up buy signals on a one to three month view. It's not clear across the board yet, but we're getting very close, some of the indicators are there. That says to us as a first point that investors should begin to build long positions for the rally.

Our second key point is we think the thesis of moving from phase one of a stylised cyclical bull market into phase two is playing out. Phase two begins, you will remember, when liquidity starts to tighten at the edges and asset prices start to respond to that. Within phase two of course we see equity markets consolidate their massive gains from phase one and consolidate those gains over the course of six to nine months with equities on average falling about 6 percent over that time period.

And, of course, the way to play phase two is to wait for the indicators to go back to buy or close to buy and then to start moving overweight and trade the rally back towards the highs.

That's where we think we are today. Start building some long positions in equities on a one to three month view. Use weakness to add to that long position.

That was The Longview. You can download this programme from our website longvieweconomics.com, from Cantos' website or from the iTunes store. Do get in touch through the website if you have any questions. We hope you enjoyed watching. Look forward to seeing you next month. Goodbye.