The Eye of the Storm?
As the markets continue to move up and the economy slowly recovers, it makes one wonder whether we are in the eye of the storm. The fundamental problems which caused the financial crisis, such as excess debt creation, have not been solved. Liquidity has been added to the system but this is only a temporary solution. What will happen if more permanent solutions are not put into place? Will the crisis return?
Some say the economy and markets will heal themselves in time; markets climb a wall of worry. That may be true, but how do we know? The answer is that no one truly knows what lies around the next corner during this unusual period in economic history. All we can do is prepare for unforeseen events by managing our businesses carefully and be conscious of business risks we take.
Asset managers who manage their firms strategically, with an eye toward judicious growth and thoughtful expense management, are likely to be the survivors of a variety of potential economic and market scenarios.
Add comment February 3rd, 2011
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