Leading Fund Managers Offer Bullish and Bearish Predictions


Financial Advisor magazine offers up brief predictions by some top fund managers.  Ruchir Sharma, of Morgan Stanely, says “We are now just one big shock away from a global downturn, and the next one seems most likely to originate in China.” Yang Zhao, chief economist with Nomura Holdings, seems to disagree: “Is there going to be a hard landing in China? I don’t think so. . . . Should any systemically important financial institutions have any problems, we believe that the government will step up to rescue them.”

Rebecca Patterson, CIO of the Bessemer Trust, discusses the situation in Europe, describing the refugee crisis as “the biggest challenge to the European Union yet” and questioning whether the crisis “could result in political and/or policy shift[s], or simply lead consumers to change their spending patterns.” Jim Vero, of JP Morgan Stanley Latin American Private Bank, discusses Latin America.  He sees “a ray of sunshine from Argentina,” and suggests “there will be some very interesting entry points in Latin American assets between now and the end of next year.” Barbara Byrne of Barclays Capitaol, sees “recovery in the prices of natural resources for largely – and critically important—political reasons,” noting the significance of energy resources for Norway and Saudi Arabia.

Thomas Lee of Fundstrat Gobal Advisors predicts “equities are going to do really well in 2016, especially banks and blue chip businesses.” Joseph LaVorgna, chief U.S. economist at Deutche Bank, sees “growth accelerating a bit because it seems like there are reasons that the economy should get better,” but he notes that overall, “the message is ‘more of the same.’”

Several other trends are noted. Mark Haefele of UBD Wealth Management sees investors becoming increasingly interested in “align[ing] their portfolios with their social values.” He points to investment in early-stage cancer research as “an opportunity to earn an attractive long-term return and benefit society.” Alan Patricof of Greycoft Partners warns of “overexuberance in financing of startups,” while Katie Kock of Goldman Sachs Asset Management predicts that “the rise of the millennials will have long-term investment implications.”