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Beverly Chandler, Opalesque London:

Stewart Paterson, is currently running a significant net short at the maximum permissible level of minus 20% in Tiburon Taurus, the firm’s Asian hedge fund, as he bearishly declares: "There is a high likelihood that investors in Asia will lose money in the coming year."

The background to his views is a wealth of warning signs and macro factors that lead him to believe that Asian markets will experience a rough time in 2014. While 2013 was a flat year for Asian markets in aggregate, Paterson believes that 2014 will prove more difficult. His views are based on the second round of chaos which is starting to materialise in Europe; the role of the US dollar; the long term outlook for China and the fact that the yen is breaking new lows.

Paterson comments that since 2002 the dollar has steadily weakened, and during that time emerging markets which target their exchange rates against the dollar have had an easier time. "Post the global financial crisis, the interest rate structures in the Eurozone and the US have clearly been an incentive for emerging markets to borrow offshore" he says. Beyond that, in the hunt for yields, money has flowed offshore dramatically with US citizens increasing their holdings of foreign financial assets from $2tln in 2002 to $7tln now. "It’s worrying that Americans are now shorter of their own currency more than ever before" he says.

"We go into 2014 wit......................

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