Our annual CFA Forecast Dinner is always a delightful event: good food, good dinner companions, and good discussion about the economy and financial markets. This year was no exception.
Kathleen Hays, popular Bloomberg radio host, was our moderator. The panel consisted of Kenneth Taubes of Pioneer Investment Management, Mark Freeman of Westwood Holdings Group, and David Tice of Federated Investments. Taubes and Freeman were the optimistic guys, with Freeman being a little more cautious. Tice was downright curmudgeonly.
With Kathleen reminding us all that “risk is a four letter word,” the panel began offering its views on the economy. Taubes said the U.S. economy is gaining traction, with housing hitting the bottom and beginning to bounce. Freeman had a good news, bad news story. He noted that retail numbers had been better than expected. Auto sales had been better than expected. The cold water was that incomes have declined recently, and Americans are still paying down debt.
Tice? He’s worried about debt, of course. Europe’s in a recession, and Asia has slowed. The best thing he could say was, “We’re not out of the woods yet.” Now that’s cold water!
Hays threw Europe on the discussion table.
All three agreed that Europe’s problems have not been resolved, but Taubes said they have moved from boiling to simmer. The European Central Bank prevented a meltdown of the financial system and “bought time.”
And oil was a hot topic. Hays says there is a $15 premium per barrel because of Iran. The consensus was that the price per barrel should be $90, not $106, but if the shooting begins, they said to expect it to go to $150. Talk about a drag on the economy then.
Tice never missed a chance to put in a plug for gold and silver. He mentioned the “Austrians” a couple times, and he was convinced a big, bad event was on the horizon. I kept waiting for him to hold up his Ron Paul placard. As I chatted with him afterwards, I brought up Paul’s name. With great gusto and without cracking a smile, he said, “I love Ron Paul!”
Yes, it was quite an evening at our CFA Forecast Dinner. Most of the panelists were optimistic about the economy. Well, two out of three ain’t bad.
>> Nancy Lottridge Anderson, Ph.D., CFA, is president of New Perspectives Inc. in Ridgeland — (601) 991-3158. She is also an assistant professor of finance at Mississippi College. Her e-mail address is firstname.lastname@example.org, and her website is www.newper.com.