Perspectives | Cordiant | Page 2

By: Cordiant  09-12-2011

Haven’t we all wondered about the usefulness of expert advice? How often do advisees implement the advice they receive?  Why do advisees pay substantial fees to their advisors, only to ignore such advice and do exactly what they wanted to do in the first place? The following quotes may interest or, at least, amuse you: [..]

The recent reports by McKinsey and the IMF have confirmed the strategy adopted by Cordiant in the late nineties. The decline in interest rates over the past three decades is often attributed to the ‘savings glut’. In reality, however, the global savings rate as a percent of global GDP declined from 24 percent in 1980 [..]

Economic activity requires an encouraging regulatory environment and effective rules that are transparent and accessible to all. The 2011 issue of Doing Business1 confirms that the trend towards the streamlining of regulations continues, particularly in the developing world. Between June 2009 and May 2010, governments in 117 countries implemented 216 business regulation reforms. These reforms [..]

The following summarizes the IMF’s view on capital flows into developing countries.[1] Developed country sovereigns have experienced 25 downgrades since early 2008, while emerging market sovereigns have seen 21 upgrades during 2010.  The following chart[2] illustrates the diverging trends between developed and developing markets. As a result, we have seen strong capital inflows to emerging [..]

Just because everybody is doing it does not make it right, or to quote Henrik Ibsen: “the majority never has right on its side”. Capitalization weighted indices do not reflect the reality of institutional portfolios unless they are indexed. Actively managed portfolios do not hold three times as large a position in ABC as compared [..]


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09-12-2011

Perspectives | Cordiant | Page 3

No prudent and forward looking asset allocation program can be designed without understanding the massive demographic changes that will reshape our world over the coming decades. As Reinhart and Rogoffdemonstrate in their January 2010 paper, there is a strong relationship between the level of government debt and real GDP growth.


09-12-2011

Perspectives | Cordiant - perspectives fr

The following summarizes the IMF’s view on capital flows into developing countries.Developed country sovereigns have experienced 25 downgrades since early 2008, while emerging market sovereigns have seen 21 upgrades during 2010. Most of us realize that over the last decade the roles of advanced economies and emerging markets have been reversed, but few of us have changed the structure of our portfolios to reflect this reversal.


09-12-2011

Perspectives | Cordiant - perspectives

Not only has the corporate landscape undergone a notable and dramatic improvement since the bottom of the financial crisis, but the high expectation of corporate default that accompanied the crisis proved to be wildly overestimated.