February 2017 -
As 2017 is getting underway, investors are facing an uncertain market environment, underscored by trepidation about what many perceive as a shake-up in the world order that may increase prosperity and new opportunities for some and pose big risks to others.
On February 1, Rock Creek founder and CEO Afsaneh Beschloss joined Senior Advisors Dr. Alan Greenspan and Liaquat Ahamed to share their views on the outlook for the year ahead.
Some of the top quotes from the discussion included:
On the Fed:
"The early stages of stagflation feel very benevolent. The trouble is, the presumption that they're going to keep the inflation rate at, say, 2%, as a policy matter is contradicted by history. It's never been feasible."
- Alan Greenspan On U.S. trade policy:
"If we do go down the protectionist route, we will not be alone; other countries will respond… A stronger dollar runs completely counter to the Trump administration's protectionist mode. It makes imports cheaper and exports more expensive, so there's a fundamental tension between what [The Trump administration] is doing on macro policy and what they want to end up doing on trade. Whether they'll be able to resolve that tension, we don't know. But I would think, in the short run, we get a stronger dollar."
- Liaquat Ahamed On emerging markets:
"The big question for emerging markets is what happens to China. China has basically managed to keep going because of this credit bubble, and at some point, the credit bubble runs out and they're going to face a problem… One good thing is that emerging market assets are not overpriced."
- Liaquat Ahamed On financial regulations:
"I think that there is a serious understanding that this administration will in a major way reduce regulation, including in the financial markets. Dodd-Frank, which is disastrous, has to be taken apart and not put back together again. It has one component that is useful, and that is the increase in the capital requirements of financial intermediaries."
- Alan Greenspan