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As the WEF 2020 is currently being held at Davos, a British financial services exec has pointed out that people at the forum have investments in mind but don’t know where to allocate them.
The World Economic Forum (WEF) 2020 is currently taking place in Davos, Switzerland. The WEF is a meeting of some of the most powerful people in the world, as they discuss the global economy and other related issues. As it turns out, according to British investment exec, the major problem among WEF participants in Davos is deciding the best investment channel for their hefty funds.
WEF Attendees Are Keen on Investment but Don’t Know What to Do
Speaking to CNBC’s Steve Sedgwick on Monday, the vice-chairman of British investment company Standard Life Aberdeen Martin Gilbert made a few points. According to him, many of the heavyweight investors currently believe that the general state of the market looks stable enough and want to buy in. Where exactly to buy in, is the big issue. Gilbert said:
“The biggest problem that the people I meet here have – the investors who give money to us – is ‘where do we put our money?’ And that is the big issue they all have.”
Slow Investment Growth
Concerning investment, the global economy has been somewhat slow. For bond yields, there has been a considerable drop giving the general market a tainted look. There is also the thought among many, that in the equities markets, we are already past the biggest profits that can be made.
Piling on the bad news are figures from the International Monetary Fund (IMF). In October 2019, the IMF put the global growth rate for 2019 at 3% and that of 2020 at 3.4%. Now, the Fund has retraced its steps a little bit, putting 2019’s figure at 3% and 2020’s at 3.3%. Reportedly, one of the major reasons for this revision is the poor growth of the Indian market.
In a statement, IMF Chief Economist Gita Gopinath said that it is still too early to predict what growth in the near future will be like. She noted:
“The projected recovery for global growth remains uncertain. It continues to rely on recoveries in stressed and underperforming emerging market economies, as growth in advanced economies stabilizes at close to current levels.”
Gopinath, however, notes that even with this uncertainty, there is some respite. One of those is Phase 1 of the trade deal between the U.S. and China.
Market Is “Reasonable”
Gilbert says that to him, the markets currently look reasonable. It’s safe to assume that investors agree and are willing to continue investments, despite the slow investment growth as described above. Gilbert believes that investment channels such as stocks, property and high-yield credit are all good at the moment. He, however, expressed that he is “slightly worried about” government bonds.
The exec added that for now, the investors are looking away from public channels and are focusing on private markets. The heavyweights are channelling the big bucks into big investments like real estate and airports.