Welcome to the GAIM GMA Event

Geopolitical Risk // Macroeconomic Insight // Alternative Investment

Policy Makers, Investors and Managers Debate Euro Crisis, Global Imbalances, and How Macro Policy Considerations Will Shape the Investment Landscape for Many Years to Come

New York, NY – October 14, 2011 – The GAIM GMA conference on geopolitical risk, macroeconomic insight and alternative investments, bought together internationally renowned economists, hedge fund managers and investors for a two-day discussion on a wide range of topics including the fate of Europe, China's contradictory economic indicators, a new "golden era" for U.S. farmers and the challenges pension fund administrators face in their search for 8% portfolio returns in a near zero-percent interest rate environment while encountering risk and volatility at hitherto unprecedented levels.

Keynote speaker Dr. Willem Buiter, Chief Economist at Citigroup, predicted a recession for Europe and a slowdown in the U.S., saying developed markets may feel the "aftermath of excessive leverage" for years to come. Famed short-seller James Chanos sparred with Princeton economist and investor Burton Malkiel over China, with Malkiel predicting continued robust growth and Chanos calling for collapses in China's banking, property development and construction sectors.

Bank of England policy maker Adam Posen said he was "pleased" with the central bank's decision last week to approve use of a second round of quantitative easing to stimulate Britain's faltering economy, a move he has been advocating.

In the conference's most bullish scenario, Mike Dwyer of the U.S. Department of Agriculture, said the next decade could be the 'Golden Era' for agriculture as worldwide demand for food and land rises, led by a growing global middle class.

In a sobering examination of the global fiscal environment, Peter Orzag, former Director of the Office of Management and Budget and now Vice Chairman of Citi Global Banking, said there was a 25% probability that Europe would implode, described by one attendee as a scenario "worse than Lehman Brothers". Although striking a pessimistic tone regarding the ability of the US to broach the debt to GDP ratio, Orszag posited too that the CBO growth estimates might be too optimistic; he did entertain a 25% chance of success by the 12-member Congressional panel charged with finding an additional $1.5 trillion in debt savings over a 10-year period.

Dr. Edward Luttwak of the Center for Strategic and International Studies, warned that a country-- and investors in it - are vulnerable when its national myth is not in 'good working order.' The national myth of the U.S., for instance, that people can improve themselves is being undermined by falling wages, he warned. The 'myths' of India, China, the U.S. and trans-Europe are also vulnerable.

Eric Chaney, Chief Economist of the AXA Group, predicted financial markets will be disappointed by further procrastination by European policy makers, but investors risked overlooking the long shadow of history and Europe's intense desire for political stability.

If there was one over-riding theme at the conference, it was that investors will scrutinize government policy as closely as balance sheets in deciding where to invest. Without a keen appreciation of the implications of the structural policy changes, investors would be ill-equipped to navigate markets in the short to medium term. As Perella Weinberg Partners' Daniel Arbess put it, Government is the 'new actor' on the investment scene.

Thank you to everyone who attended GAIM GMA. GAIM will hold its next conference for the alternative investment community January 22-25, 2012 in Boca Raton, Fl. For more information, please click here