Beautiful weather aside, the Middle East is experiencing its busiest period since this time last year, as investment bankers, entrepreneurs and unfailingly ambitious fund-raisers swarm across the entire collection of GCC states knocking on the doors of clients and leads they have not seen in many months. The allure of $80/brl speaks for itself across international markets; capital needy industries and return-hungry investors alike hoping the cash-rich (yet freshly reeling from losses) sovereign wealth funds and traditionally wealthy family groups have the appetite for further investments. Apart from OPEC’s Director General El Badri stating that economies will not be able to grow if oil remains above $80/brl – seems OPEC are comfortable enough making significant profits rather than incredibly rig-defying flows of cash – speculators and the more positive out there happy enough to take comfort in decent earnings results/forecasts to anticipate greater commodity demand. Iran’s disappointing stalling of nuclear talks (slightly) contributing to the rise.
Almost as difficult as obtaining a ticket for the Beyonce concert during the Abu Dhabi Grand Prix, Galleon is attempting to hold-on to the few remaining clients invested in their funds – those investors must have been away on holiday and without access to modern media for the past few days – the backlash now extending across a growing number of implicated individuals – excellent material for dinner-table conversations, but unfortunate for those attempting to defend the “best” aspects of capitalism. You can just hear Madoff’s excitement at having a fellow “investment professional” join him in his cell to continue the debate.
Remember to forget…
Some conversations around the region lead one to believe the markets are in for a turbulent ride over the next few weeks. That consensus makes sense when the impressive market performance over the last few weeks (good international flow, no nasty surprises in earnings) are considered with gains of almost 6% across many of the majors since mid-Oct. The rise of oil and gold and the fluctuations witnessed in US$ may be the first indications of some shifts in equity sentiment before the end-of-the-year. Many fund managers and investors are sitting in front of their screens feeling pretty good about themselves right about now (not remembering maybe the incredible amount of help - known as “aid” in any other industry - they have received through super-infusing of liquidity and a suspension of many rules resulting in a removal of key obstacles).
Who would have thought gains of 60% on portfolios would be commonplace after such a disastrous ’08 and a rather dismal start to ’09? Step back and consider what we have come through, and try to recall how it felt when we were truly facing a dark deep hole cut out of an unprecedented crisis, and the action of taking profits and removing money from the table is easily understood. Many books will be closing early this year one thinks. Arguments over whether enough has been done to prevent any further exposing of the questionable fabric of much of capitalism, understandably placed to one-side for now.
Qatar-eny…
What certainly was not so slight was the impressive (est. $1bn) profit our friends in Qatar successfully realised yesterday on their Barclays stake – a fair enough return for having the confidence and manoeuvrability to pitch-up for those that they believed in and supported in their time of need. It is easy to forget the sentiment and state of mind that prevailed during that (seemingly ages ago) period of panic and when faced with such unknown territory, the guts to put your cash-where-others-had-turned-their-mouths-from deserves to be rewarded. The worry is the backlash against those brave enough to take action during the worst of the crisis whom will no doubt be singled out as making “excessive” profits at the expense of others.
Well excuse me, but throughout history and whether we like it, agree with it or just plain have to put up with it and accept it, those lucky enough to have the resources to hand at a time when others are suffering, do normally profit at what is then deemed to be the disbursement of others. Just because you possess the means to make a decision does not always mean the right decision is taken – the pulling of the trigger at the right time and in the right direction is what deserves the (excessive to some, deserved to others) reward.
Forever young?
It seems man is obsessed with trying to live beyond his years, and if the latest news is anything to go by, we’ll soon have octogenarians routinely taking part in marathons and popping up beside their 20-something compatriots on technogym cross-trainers in gyms across the country – and we’re not talking in the middle of the afternoon as they try to hide tired-elastic flesh behind inappropriate gym-attire, but rather showing off their toned (artificially enhanced) limbs at peak-time. This idea of longevity and prolonging our time on earth has existed since the days of Aristotle, but with technology now catching-up with our own (in)human desires, we seem to be taking a step closer to dreams of immortality.
It does provide a slither of hope for the financial industry though – with so much first-hand experience available through veteran investors continuing to function on tough trading-floors with the best-of-the-new-breed, hot-temperaments and risk-taking may benefit on the back of wise knowledge – or will it only hinder progress? Time and age alone will tell.
No comments:
Post a Comment