Today I attended the Schroders seminar for Livery companies – the title was ‘Eurozone Crisis – where Politics and Economics Collide!’ And the main speaker was Alan J Brown, Schroders Chief Investment Officer.
The seminar was attended by a cross section of Livery Companies from the mighty Drapers to the modern companies. Alan did us the complement of assuming we were all well versed in the details of global economics and fiscal policies. The message was tough, many risks on the down side and not much joy on the upside for the next few years. Anything from a good dose of inflation to the break down of democracy in countries where the government tries to enforce austerity measures, and even the horror of Angela Merkel supporting Sarkozy’‘s bid for president. But despite this tale of woe, there were glimmers of hope in the US, and good value in the stock market.
Alan summed up his view of sovereign debt in the words of James Grant
Government bonds – once a risk free rate – now a return free risk
And asked – which would you prefer, a 10 year gilt with a yield of 2% or Marks and Spencer with a yield of 4.8%?
For those of you who know Tom