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February 18, 2009
Neither a lender nor a borrower be - Duncan Artus
Markets remain frozen despite billion dollar bailouts.
In the last 200 years or so, according to Allan Gray's Duncan Artus, the current banking crisis has happened a number of times, most notably in 1907 when JPMorgan saved Wall Street and money markets froze.
"No matter how much money the banks are given by the government they don't want to lend and consumers don't want to borrow either because they've just got into trouble". Allan Gray's message is that the problem is really big and even though they've heightened their share exposure in almost all of their asset allocations, margins of return are going to shrink. The reasons Artus says is that earnings continue to be high and a lot of the growth is driven by debt.
Posted by StaffWriter at February 18, 2009 7:24 AM