Secretary of State John Kerry blamed the government shutdown that ended last week for fueling international doubts about America's commitment to global leadership, eroding U.S. standing and influence.

Kerry spoke yesterday as some of America's closest allies are criticizing U.S. electronic spying and questioning its resolve in confronting international crises. The discord risks undermining longtime alliances and support for the Obama administration's pursuit of negotiations with Iranand Syria.

Leaders in Israel and Saudi Arabia, the two closest U.S. allies in the Mideast, are faulting American moves regarding Iran's nuclear program and Syria's chemical arsenal. German Chancellor Angela Merkel and European leaders are echoing angry complaints from Latin America about U.S. surveillance. Asian diplomats, with China in their backyard, are questioning America's pledges to bolster their security after the U.S. backed away from a threatened military strike against Syria.

"It's the perception that there's an abandonment of a robust international agenda," said Ian Brzezinski, a senior fellow at the Atlantic Council, a Washington policy group. "In a world where America is seen as less engaged, our opponents will see more opportunity to assert their values."

"It's less likely to be conducive to the spread of democracy and rule of law," said Brzezinski, a former Defense Department official under President George W. Bush. "It creates a less stable world."

Ben Rhodes, President Barack Obama's deputy national security adviser, said complaints from overseas don't reflect a weakening of American influence, describing such gripes about U.S. power as a cyclical occurrence.

David Fuller's view There is little doubt that the ongoing US political impasse leading to brinkmanship over the debt ceiling and the recent partial government shutdown has undermined America's reputation for sound governance.

Nevertheless, there is also a 'damned if you do and damned if you don't' aspect to criticism of US international policies in the last few years. This reflects global anxiety over not only the decisions and events being questioned but also the uncertainty caused by domestic problems in most countries, not least due to weak GDP growth which compounds the difficulties of governance. Consequently, there is additional apprehension over what happens when the US really does exit from quantitative easing (QE).

Tapering of QE will almost certainly not occur before well into at least 1Q 2014 and perhaps considerably longer. The obvious reasons for further QE would be continued slow economic growth and a lid on most inflationary pressures due to globalisation, which certainly helps to keep wage pressures in check. US 10-year government bond yields (weekly & daily) have commenced a bear market this year, in my opinion, but they have also been in a medium-term reaction and consolidation phase since reaching 3% in early September, which also reflects slow GDP growth.

The resulting combination of soft economies and powerful monetary policy tailwinds from QE and similar policies from other central banks remains a benign environment for global equities. Moreover, most companies, and not least the global Autonomies, remain far stronger than their national economies. However, this is increasingly reflected by rising valuations because share prices, on average, have been appreciating faster than corporate earnings.

Today, all performing stock markets are temporarily overbought. The most influential example is the USA, as you can see from these 5-year weekly charts of the S&P 500 Index and particularly the tech-weighted Nasda100 Index. A short-term period of mean reversion towards the MAs is now due and would probably be no more than a healthy correction within the overall upward trends. However, if this is significantly postponed because investors see no near-term risks on the horizon, an accelerated overextension to the upside would be followed by a correction which is even sharper.

Meanwhile, the stock markets for the world's 2nd & 3rd largest economies, China and Japan, are already weakening as you can see most clearly on these daily charts for the Shanghai A Index and the Nikkei 225. China remains an underperformer and a persistent rally is required to allay regional and even global concerns over slowing global GDP growth. The Nikkei needs to sustain a push above 15000 to indicate that is completing its medium-term consolidation.