Goldman Sachs London conducted a poll of FX/Macro fund managers today that had interesting results. The poll demonstrated that fund managers are expecting deflation more than inflation and that they expect the U.S. or Asia to escape the downturn first (and certainly not Europe or the UK). I imagine that funds are positioned accordingly in currencies, stocks, and bonds.
Here are the poll results:
- 83% of participants believe that the biggest global threat at present is ‘deflation’ vs 17% believing this will be ‘inflation.’
- 82% believe we will se a US style 1930s Depression vs a German style 1920s period of hyperinflation.
- 47% believe the US will recover first from the current crisis, 42% believe it will be China/Brazil… Only 7% believe this will be the UK and only 4% believe it will be Europe!
- 73% believe the US will recover before the Eurozone (only 6% believe that Europe will recover before the US while the rest believe they will both recover at the same time).
- 55% believe a country will leave the Eurozone 10 years from now or later – only 10% believe that this will happen within the next year.
- 44% indicate that they are avoiding all EM investments for now – 20% would invest in Latam, 27% in non-Japan Asia and the rest in EMEA.