Food for Thought
Reflections from the 2012 Morningstar Investment Conference.
Since we wrapped up our Morningstar Investment Conference this past week, I've found it hard to focus on day-to-day duties. Instead, I'm mulling over what questions to explore or what actions to consider for my family's investment plan. Here are a few thoughts, based on hearing from a number of ace managers across multiple asset classes during the conference.
Greece Matters but Will Matter More Later
Templeton's fixed-income czar Michael Hasenstab kicked off the conference with his take on the European drama, as everyone is wondering whether Greece will stay in the eurozone. In his view, a Greek exit would be strong medicine--bitter in the short term, helpful in the longer term--and dangerous only if market panic struck Italy or Spain. Spain, he argues, has more wiggle room than Italy to navigate that environment, but substantial and likely contentious labor reforms would be essential to getting both countries back on track. On a related note, Loomis Sayles' Dan Fuss raised the possibility that the situation could turn into a geopolitical powder keg if Greece leaves the European Union or if competition for the region's energy reserves heats up.
Michael Herbst has a position in the following securities mentioned above: LSBRX. Find out about Morningstar’s editorial policies.