"Stop Focusing on Downside Risks," Says Barclays Wealth Monthly Strategy Update

NEW YORK--(Business Wire)--
Our investment views:

* Financial markets are closer to fair value.
* Asia is and will remain the most economically dynamic global region.
* Short-term interest rates will stay low.
* Inflation is not the problem: inflation expectations could be.

Our macroeconomic view:

* The initial "green shoots" of recovery have started to grow and branch out
recently, as expected. The sheer passage of time has helped, but policy
responses have fostered a return of confidence, or what Keynes called "animal
spirits."
* The decline in Q2 U.S. GDP turned out to be a little smaller than economists
expected, and Q3 should see a return to growth. However, the downward revisions
to Q1 suggest that the hole the economy is climbing out of is even deeper than
seemed likely a quarter ago.
* The U.K. economy`s recent performance has been disappointing. By contrast, the
French and German economies unexpectedly expanded in Q2. That said, the detailed
statistics do not point towards an accelerating recovery.
* Emerging markets - especially those in Asia - are returning to growth, most
notably in China where the government has been successful in boosting economic
activity.

Our investment calls include the following:

* Hedge against rising inflation expectations. We don`t think that actual or
realized inflation will be a problem. However, rising inflation expectations
could pose a threat to long-dated nominal bonds.
* Maintain investments in Asia, but be selective. Rather than buying an index,
we advocate active management in Asia or "thematic" portfolios such as
infrastructure. Investors can also consider Western companies with high levels
of Asian revenue.
* Don`t settle for 0% in cash portfolios. High-quality short-dated bonds still
offer a substantial pick up in yield versus cash or short-dated government
bonds.
* Add exposure to the Brazilian Real (BRL). Brazil offersan attractive
inflation-adjusted interest rate of 4.5%. The BRL continues to look cheap and
should strengthen further against developed currencies.

Aaron S. Gurwitz, Head of Global Investment Strategy at Barclays Wealth, said:

"We no longer want to leave the impression that we`re more worried about the
potential pain of a double-dip than the opportunity cost of missing a continuing
rally. Investors whose portfolios are still positioned defensively should move
toward a normal risk posture."

Brian Nick, Investment Strategist at Barclays Wealth, said:

"Although we see Asia as the region most likely to outperform coming out of the
global recession, we are advising clients to be more selective and inventive
about investing there, given the strength of the rally since the spring."

About Barclays Wealth

Barclays Wealth is a leading global wealth manager, and the UK`s largest, with
total client assets of $221bn (£134bn), as of 30 June 2009. With offices in 25
countries, Barclays Wealth serves affluent, high net worth and intermediary
clients worldwide, providing international and private banking, investment
management, fiduciary services, and brokerage.

Barclays Group is a major global financial services provider engaged in retail
and commercial banking, credit cards, investment banking, wealth management and
investment management services with an extensive international presence in
Europe, the Americas, Africa and Asia.

With over 300 years of history and expertise in banking, Barclays operates in
over 50 countries and employs over 145,000 people. Barclays moves, lends,
invests and protects money for over 49 million customers and clients worldwide.

For further information about Barclays Wealth in the Americas, please visit
www.barclayswealthamericas.com. Twitter page: www.twitter.com/barclayswealth

Any products mentioned in this document may not be eligible for sale in some
states or countries, nor suitable for all types of investors. This document
shall not constitute an underwriting commitment, an offer of financing, an offer
to sell, or the solicitation of an offer to buy any securities described herein,
which shall be subject to Barclays` internal approvals. No transaction or
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No representation is made as to the reasonableness of the assumptions made
within or the accuracy or completeness of any modelling or back-testing. All
opinions and estimates are given as of the date hereof and are subject to
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The information in this document is not intended to predict actual results and
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Barclays Wealth is the wealth management division of Barclays Bank PLC,
functioning through Barclays Capital Inc. in the United States. Barclays Capital
Inc., an affiliate of Barclays Bank PLC, is a U.S. registered broker-dealer and
regulated by the Securities & Exchange Commission. The registered office of
Barclays Capital Inc. is 200 Park Avenue, New York, NY 10166. Barclays Bank PLC
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is authorized and regulated by the Financial Services Authority. Member SIPC.

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