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Mark Okada Bailey McCann, Opalesque New York:
Fiscal drag is the next big economic issue in the US, more than the fiscal cliff, according to leaders at Highland Capital Management. Mark Okada, Co-Founder and CIO, and Patrick Boyce, Partner and Head of Private Equity, offered their outlook for the next year to members of the media earlier today in New York. During the discussion, both Okada and Boyce voiced concerns that looming changes to the tax code, and the inability of congress to craft a viable debt servicing plan will only add to the drag on growth in the US economy.
Highland Capital Management is a Texas-based investment firm with approximately $19bn in assets under management. The firm focuses on global alternative credit strategies and amounts to one of the larger players in the space. In addition to credit, the firm also offers alternative investments including emerging markets, long/short equities and natural resources.
"If politicians understood, what the uncertainty around the debt ceiling conversation is really doing to the markets and the broader economy they would've resolved this issue a long time ago," Okada said. Highland does not expect that the US will go off the cliff, they expect a short term deal and then a bigger fix down the road. However, they do expect that the Bush tax cuts will expire for the wealthiest in the US.
Moving into 2013, both men expect that the fiscal drag will ultimately create winners and losers in the equity mark...................... To view our full article Click here
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