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Investing in a Low-Growth World
Can Innovation Alter Our Trajectory?
The Pacific Pension & Investment Institute (PPI) is pleased to return to Los Angeles and Rancho Palos Verdes for the 2016 Winter Roundtable. We thank all of our members, especially those based in the Los Angeles area, who have provided assistance in developing this program.
If one word can describe the state of global financial markets so far in 2016, it would be volatile. Investor unease has already led to bear markets in many countries, including Brazil, Canada, China, France, Germany and Japan. The US could enter bear-market status with the Nasdaq down 17% from recent highs, and the S&P 500 down 13%. Investor nervousness is palatable due to the fall of commodity prices, most notably oil, concerns that another global recession could be on the horizon, and increasing doubts regarding banking institutions’ ability to absorb the impact of these potent forces. China’s slowdown is felt far and wide, particularly in countries reliant on exporting raw materials, such as Brazil and South Africa. Europe, faced with social, economic, and political challenges of its own, seems on the verge of further political and economic turmoil, with both Greece and Great Britain contemplating withdrawal from the EU.
The recent market downturn notwithstanding, opportunities may exist to revitalize floundering economies and to promote long-term sustainable growth. While the availability of cheap capital may be the culprit of the recent slowdown of productivity, innovation could provide a path toward a recovery and sustained economic progress. The computing revolution has repeatedly revolutionized the way that we work and it powered the global economy through much of the past three decades. Have we realized the bulk of the productivity gains, or will innovative thinkers create a second technological renaissance? Similarly, institutional investors have been thinking innovatively for ways to achieve their expected returns. Can new investment strategies help to more effectively navigate the current low-growth environment?
PPI’s 2016 Winter Roundtable will focus on how institutional investors might invest in this low-growth environment. What strategies can be pursued to meet return targets? How are institutional investors communicating this ‘new normal’ to their beneficiaries and stakeholders? Will long-term investors continue the exodus from Emerging Markets?
The Winter Roundtable will also consider ways in which innovation could alter this narrative. The continued exponential rise in computing power, along with growth in new investment opportunities focused on sustainability and the needs of future generations, may unleash new growth potential in countries and industries. Walter Isaacson, president of the Aspen Institute and author of numerous books related to innovation and great minds throughout history, will provide opening keynote remarks on Wednesday, February 24. The following morning, speakers will consider the current global environment, political and strategic concerns, and potential opportunities for the year ahead.
PPI programs strike a delicate balance between formal programming and networking opportunities. We firmly believe that the value of a roundtable to our members and other participants does not begin and end with each session. We encourage you to contribute to the discussion through questions and comments during the Q&A periods. We also urge you to introduce yourself to new colleagues during the breaks and meals.
Lastly, I take this opportunity to underscore PPI’s longstanding traditions. As with all PPI events, we require our participants to adhere to our no-marketing policy as well as the Chatham House Rule (no attribution of comments made). There are many ways that one might market financial products and services, from subtle to overt. Any list of prohibited marketing behaviors would be incomplete. Simply put, if a participant reports to any member of the PPI staff that their experience at a roundtable was diminished by the marketing behavior of another participant, we will act swiftly to address this violation of PPI policy, including removing the offending individual from the remainder of the program. Accordingly, he or she will not be invited to future PPI programs.
We strive to create an environment that is conducive to peer to peer learning— and in a safe setting. For many members, this is a key reason for attending PPI programs over those of our competitors. It is therefore critically important that PPI uphold the practices that encourage openness and a deeper sharing of information and experiences.
Thank you very much for your continued strong support of PPI and for your active participation in our global network of senior institutional investors. With best wishes,
Lionel C. Johnson