Alternative Market Briefing

Eurofin chief investment officer believes 'crisis fatigue’ has set in for investment managers

Tuesday, February 07, 2012

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James M.M. Edwards By Beverly Chandler, Opalesque London:

James M.M. Edwards, Chief Investment Officer, Eurofin Capital, the Lausanne and London based privately owned investment company, posed the timely question ’A new year, a new set of challenges’ for his monthly newsletter, expressing what he called a 'strange sense of déjà-vu’. "The Greek debacle is still not resolved, Iran is threatening to block the Hormuz Straights, thus cutting off 25% of the world’s oil supply, Europe is teetering on the brink of collapse, elections in many countries this year which might well change the entire political landscape, interest rates at zero for the foreseeable future, senior bankers' bonus payments making headlines and hedge funds still below their high water marks".

Edwards recalls the Mexican Tesobono crisis, the Russian 1998 Default, then the Argentine 2001 default as well as the more recent Lehman Brothers default. "One thing that becomes clear is that after a while, investors get "crisis fatigue". When they realise that notwithstanding the significant event that has just taken place, they still have a job to do, capital to invest and decisions to be made that must not only conserve capital, but also generate returns. I do not know at what precise moment "crisis fatigue" kicks in, and I am more than certain that there are people who have thoroughly researched this very subject......................

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