Last day of this year’s conference has come. This day is always bitter sweet. Your head is full of new ideas, insights and maybe new acquaintances. But still you long for more. And more will come, as the 73rd CFA Annual Conference next year will be held in Atlanta.

By Kenneth Brandborg | The 15th of May 2019

The tide has turned

Last year, my last blog from the conference was called ‘At the end of the road lies happiness’. This is certainly not the feeling we are left with after this year’s conference. The mood is somewhat comparable with the mood on the 2008 conference in Vancouver. There is a lot of uncertainty, growth is diminishing – and we actually can’t say whether more growth will be good or bad. The faith in the capitalism and in the market is at best challenged, and we are relatively certain that we have no good answers for the challenges ahead.

Capitalism is dead

Back in 1989 communism fell. We thought that it proved the superiority of capitalism. Capitalism celebrated for a couple of years, by opening boarders and promoting international trade. Lacking an opponent, capitalism had nothing better to do than go home lie on the couch and watch TV-series. Now some 30 years later capitalism wakes up fat and out of shape in a world that has changed and needs solutions to problems, capitalism to late has acknowledged. To get back in shape capitalism needs to get up and start training hard. As everybody, who has taken a similar challenge, knows it will be hard, take time and a tremendous amount of persistence.

The Italian female Bernie Sanders

Today headed of with an interesting talk by Mariana Maccuzato. She is the sign of a good trend at the Annual Conferences. More and more female speakers appear than I remember from earlier years. And this year has another twist to this. At earlier conferences, I have seen female speakers, where you had the suspicion that their primary virtue was that they were female. This year that is certainly is not the case. The women on stage are bullet proof, chosen to give a presentation because they are super skilled – as it should be.

Now back to Mariana. She had some very interesting views on the interaction between public and private money. Ideas that only for a couple of years ago would be called communistic, but today are acknowledged as solid ideas to solve some of our problems. Main theme was that governments should more actively engage in the private sector with clear ambitions and patient money. She even said the word ‘public banks’ without any one passing out. Now some of these ideas reassembles much of the campaign by Bernie Sanders. Another treat she has in common with him is that she loves Denmark. Especially that we have managed to become the largest exporter of green energy solutions to China. That was a classic example on how governments should set up the framework and strategy with sectors to achieve great goals for sustainable development.

Another subject she touched upon was the rise in inequality. Again, it is becoming so extreme that something has to change. Hopefully within the boundaries of the existing systems, but as she said, never before in history has there been so large an inequality without giving rise to a revolution.

This year’s graph-rider

This year the last presentation was the feared graphs, graphs and more graphs. The presenter turned his back to the audience to look at the graph. Mostly only citing, what the graph showed. To make a complete Kinder-egg of mistakes he also used a legend so small that nobody could read, what he had written on the slides. On top of that the subject was more or less the same as Mohammed had treated the day before – just with a bit more focus on Europe – the result is pretty dull. Tone deaf came to my mind, as Lorenzo suggested that we should have a true fiscal union within EU. I don’t think that the political environment is currently heading that way. He could just as well suggest that a super hero should appear and fix all the problems. Both scenarios are currently equally likely.

It got better in the Q&A session, but honestly, I think we were a lot of participants how regretted that we hadn’t booked a plane earlier. There is definitely not much disruption in letting an elderly C-level white man in a grey suit walk through a ton of slides.

In contrast to the other macro dudes Lorenzo was less pessimistic – I have a suspicion that he has read the perfect piece of advice in the Hitchhiker’s Guide to the Galaxy: ‘Don’t Panic’. A truly valuable advice in these times.

All in all, the Macro speakers were relatively in line. So, let me sum up, what they told. Italy is in terrible shape, Brexit is a mess, and the consequences are already showing, Americans believe that the Euro eventually will break, Europeans think it will eventually work. Everybody cheers on Trump to bully the Chinese to a fair trade deal. Capitalism has taken a serious hit, and we need to do something on the concentration of profits and the rise in inequality.

It will be very interesting if the Atlanta Conference will be held in the shadow of recession and rising environmental problems, or if we actually will be able to turn things around, and again hope for happiness at the end of the road.

None the less. Michael Lewis will attend the Atlanta conference and so will I. He as high fly speaker and I as your humble blogger.

Yours truly

Kenneth Brandborg, CFA

Co-founder & CEO SapioX

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