Financial analysts and private bankers expect the global economy, with the help of a more dynamic Asian region, to bounce back sometime in 2010, but also anticipate employment prospects, vital in reviving consumer demand, to lag behind.
“I think 2010 will be the turning point in terms of the global economy,” said Olivier Collombin, executive director of the private bank Lombard Odier, Geneva, one of Europe’s oldest private banks. “And as we all know, the markets will anticipate it,” he said in an interview on the sidelines of a conference by the Convention of Independent Financial Advisors, an umbrella group that represents independent asset managers who oversee more than 20 percent of global wealth.
Pressed if the recovery would come in the first or second half, Collombin said, “It’s hard to say.”
Collombin, who recently returned from business trips to the U.S. and Asia, said even though the American economy went into the financial crisis first, he was doubtful whether it will be the first major one to emerge from the slump. Instead, he anticipates the Asian region may come out of it faster.
“It is a more personal feeling, based on the dynamic spirit behind the region. The United States is so deeply into this crisis, so it can’t be all that easy to get out,” he said.
The International Monetary Fund, in its latest regional outlook for Asia and the Pacific, forecasts overall growth for Asia to decelerate to 1.3 percent in 2009 from 5.1 percent in 2008, and to return to 4.2 percent in 2010. The fund also projects the region’s biggest economy to grow by 6.5 percent this year, down from 9 percent in 2008, and to expand by 7.5 percent in 2010.
Leong Sze Hian, president of the Singapore-based Society of Financial Service Professionals, was upbeat that by the end of 2009 the global economy might start recovering. “I’m personally optimistic governments are really getting their act together. All you have to do is to keep on spending and you will be out of the crisis. It’s a matter of how much,” he said.
Mark Fisher, an American-Swiss asset manager with Wealth Management & Cie, Geneva, was more cautious and expects first a consolidation and stabilization before the U.S. and other economies fully recover. “I believe the global economy will stabilize, but it will not improve in the same way as having a big recovery, but rather more a consolidation.”
He said there are still issues that will continue to recur for some time.
“There will be increased defaults, there will be borrower defaults starting, and there will be some credit card defaults,” he said. Fisher said he’s looking at a turnaround “at the beginning of 2011 or late 2010,” and noted the continuing increase in unemployment is a concern.
“If consumers are going to get us out of this, then they’ve got to start getting jobs again, and they’re not going to get jobs in six months or in one year. They’re going to get jobs in a few years,” he said. He stressed that 70 percent of the U.S. economy is consumer-based, but argued that as it moves forward its pace will be reset, “which will be roughly 5 to 10 percent less than what we’ve seen historically.”
But analysts also expect the dollar’s supremacy to be challenged down the road with major economies such as China, Russia and others trying to diversify away from dependence on the dollar for transactions.
“My view is that gradually they will reduce their exposure to the dollar. Because after this crisis, and the amount of money everybody is spending, payback will come back sometime in the future, and it’s going to be a dollar-based crisis again,” said Leong.
In his new book “Hollywood Royale,” Andy Warhol’s Protégé Matthew Rolston celebrates the Eighties revival of Hollywood glamour. Featuring more than 100 portraits taken by Rolston from 1977 to 1993, the book contains photos of icons like Michael Jackson, Cyndi Lauper, and @drewbarrymore, pictured here in 1991. “Hollywood Royale,” out today, will be accompanied by an exhibition opening at Los Angeles’ Fahey/Klein Gallery on March 1. #wwdeye
"Nowadays when life is not so happy with everything going on in the world, I think people come to me for a little bit of whimsy and color and fun." - Designer Rebecca De Ravenel on her cult-favorite jewelry line. (📸 : @vsteves) #wwd40
“Everyone is talking about how the retail industry is struggling, but I think it’s an incredible time because brands who are doing something different and innovative are setting themselves up for the future,” said @adamgoldston, who founded the luxury athletic brand @apl with his brother @ryangoldsten. The Goldston’s are part of WWD’s 40 under 40: a group of industry notables. See the rest of the list on WWD.com. (📷: @vsteves) #wwd40
@eyeswoon blogger Athena Calderone debuted her first-ever cookbook, “Cook Beautiful,” which is heavily centered on the presentation and visual expression of food. Pictured here are her miso glazed carrots from the book. Get the recipe on WWD.com. (📷: @johnny_miller_) #wwdeye
“It’s passion that helps get anybody to a certain point and it’s what’s propelled me,” said Kith founder @ronniefieg, one of WWD’s 40 under 40: a group of industry notables who are changing the face of retail, fashion and beauty. Fieg, who opened a Manhattan flagship on October 7, began his career at age 13 as a stock boy and salesman for footwear chain David Z. “I think staying true to [my] beliefs, hard work and passion have gotten me to where [Kith] is today.” See the rest of the 40 at WWD.com. (📷: @vsteves) #wwd40
25-year-old @samweaving is about to break out this fall, starring in Netflix’s horror film “The Babysitter,” fittingly out today on Friday the 13th. That’s not the only place you’ll be seeing her, though — Weaving’s got a role Showtime’s “SMILF” and another alongside Frances McDormand and Woody Harrelson in “Three Billboards Outside Ebbing, Missouri.” Though she’s got a full plate at the moment, there’s one role she’s got her eye on: Marilyn Monroe. “I’m a little too young at the moment, but it’s on my bucket list,” the actress told WWD (📷: @dandoperalski) #wwdeye
BFF's Poppy Jamie and Suki Waterhouse celebrated the launch of their bag line Pop x Suki at Nordstrom last night. "The line is really about our friendship, and how we are so different but complement each other," said Waterhouse. 👯 (📷: Katie Jones) #wwdeye
After designing the new @louisvuitton and @bulgariofficial flagships and a @chanelofficial boutique opening in Japan, @petermarinoarchitect has another project on his plate: The Lobster Club. Located in the Seagram Building, it’s the famed architect’s first restaurant project in New York, serving up modern Japanese brasserie-style cuisine. Bronze hues, bespoke material detailing, blush and chartreuse tones and a heavy emphasis on Picasso can be seen throughout. Mark your calendars for Nov. 1 for the much-anticipated opening. (📷: @clint_spaulding) #wwdeye
Did you know: @carlychaikin of "Mr. Robot" has been painting for about a decade? The actress, who plays Darlene on the show, is a self-taught artist who lists Salvador Dalí and Chuck Close as some of her idols. Chaikin told WWD that painting is a form of meditation for her — A much-needed one given the intensity of "Mr. Robot." See a piece Chaikin is working on at WWD.com (📷: @jilliansollazzo) #wwdeye