Investment

Quarterly Investment Review – Q2 2021

by James Macpherson

Quarterly Investment Review – Q2 2021

Markets continued to move ahead in the second quarter as vaccinations were rolled out, allowing lockdowns to be eased. The vaccination process is most advanced in the US, with Europe a couple of months behind, and the Emerging Markets only really starting their programs now. Nonetheless the stock market recovery of the last year seems incredible against a background where the EU suffered its worst recession since the 1930’s, the world has seen the first rise in poverty for twenty years, and millions of families have seen their prospects and financial situation dashed. The exuberant financial performance has come on the back of the huge double barrelled fiscal and monetary response by governments and central banks, which in turn has led to the question of when these support operations will stop, and whether they will trigger inflation.

The policy response to Covid was extraordinarily aggressive. The fiscal response in the first three months was equal to that of the previous five recessions in the US. US monetary policy produced more QE in six weeks than the total of the 2009-2018 period following the Financial Crisis of 2008. This has led to an abrupt recovery, but more puzzling is this unprecedented stimulus has continued even when the recovery is fully evident. The Fed still buys $40bn of mortgages a month even though there is now a housing shortage. They have said that they are not thinking of reducing their bond purchases of $120bn a month, and do not expect to raise interest rates till 2023 despite the booming economy. The strongest economic recovery since 1945 is being met with the easiest financial conditions on record. At 25% of GDP the recently announced programs of President Biden are greater than Lyndon Johnson’s Great Society programs of the 1960’s. It suggests that the authorities have some doubt as to how well economies would manage if these supports were removed. While the recovery allows the private economy to pick up, there is a big gap to fill. The setbacks and uncertainty caused by the variant strains of Covid also make full unwinding of the lockdowns more complicated. This makes the authorities’ task of judging how and when to withdraw their stimulus much harder.

Will this stimulus translate into higher inflation?

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Antonio Mira
CHIEF FINANCIAL OFFICER, MEMBER OF THE EXECUTIVE COMMITTEE

Antonio Mira joined NS Partners in 2006 as Group Chief Financial Officer. He heads the corporate functions and is involved in coordinating and implementing the decisions of the Executive Committee.
An experienced bank auditor, Antonio started his career in 1995 with Arthur Andersen, where he worked for some 7 years before joining Ernst & Young in 2002 as a Senior Manager.
Antonio is a Swiss chartered accountant and a Business graduate of Lausanne University (HEC).

Sébastien Poiret
DEPUTY HEAD OF WEALTH MANAGEMENT

Sébastien Poiret joined NS Partners in 2008 and manages funds of hedge funds and private client mandates. He also oversees the development of the Group’s offices in Mauritius.

Prior to joining NS Partners, he served as a Trader, Head of Manager research and Portfolio Manager in the USA and Switzerland for a single hedge fund (1998-2004) and for Optimal (2004-2008), Grupo Santander’s fund-of-hedge funds operations.

Sébastien holds a Bachelor’s degree in Corporate Finance from the ESPEME Business School (EDHEC Group) and an MBA in Finance and Economics from the Institute of Business Administration, both in Nice.

Abir Oreibi
BOARD DIRECTOR

Abir Oreibi joined the Board of the NS Partners Group in 2018, where she brings her truly international perspective and rich experience.
Among many other ventures, Abir set up Alibaba.com’s first European office. After living and working in Shanghai, Hong Kong, Bangkok and London, she now lives in Geneva, where she is CEO of Lift Events, an organization that identifies technology trends, their business and social impact through the organization of events and open innovation programs. Issues related to the challenges and opportunities created by new technologies as well as the strategic responses from organizations are at the heart of Lift’s activities.
Abir holds a BA in Political Sciences from the University of Geneva. She is an investor, and member of advisory and innovation boards.

Romain Pidoux, CAIA

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Romain Pidoux joined NS Partners in 2011 and heads the Group’s Risk Management.
He started his financial career in 2005 as Head of Quantitative Analysis for a Swiss Family Office, selecting funds and managing portfolio allocation. In 2008, he switched to the alternative world and joined Peak Partners as hedge funds analyst.
He is a Chartered Alternative Investment Analyst (CAIA) and holds a Master’s degree in international relations from the Graduate Institute of International Studies at Geneva University.

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