Women’s Networks Host Panel Talk in New York on Credit Markets
Published: March 19, 2008
By Allan Kreda
Amid news of the day’s 415-point rise in the Dow Jones Industrial Average and fresh moves by the Federal Reserve to inject liquidity into the marketplace, panelists gathered for an annual discussion co-sponsored by the Merrill Lynch Women’s Professional Network and the Women’s Bond Club of New York.
The discussion on March 11, “A Global Economic Forum: Impact of U.S. Credit Markets,” focused on the subprime mortgage crisis, the Federal Reserve’s reaction and where to invest in such choppy markets.
“Problems are big and serious, and I’m not sure lawmakers know what to do,” said Kathy Bostjancic, a senior Research director and U.S. economist. “There are many overlapping issues and much uncertainty. It sure does feel like recession. What the Fed has been doing is akin to dispensing aspirin when you have bigger ills. It only makes you feel better for a while.”
“Hard to believe, but only four months ago the Fed was declaring all is well. Now some institutions are teetering on the brink of insolvency,” said Leslie Norton, the evening’s moderator and Asia editor for Barron’s magazine. “What happens next is of interest to all of us.”
Panelists also discussed policy changes that may be made by the 2009 occupant of the White House — whether a Democrat or a Republican — in particular, regarding income tax rates.
“I’ve been telling clients that I don’t care who will be in the White House,” Mr. Bryson said. “Taxes will go up without an act of Congress because Bush tax cuts expire in 2011.”
The Women’s Professional Network is a forum for Merrill Lynch employees to share experiences, advice and provide mentoring. The Women’s Bond Club of New York, established in 1921, includes women from all sectors of the financial industry.
Women who attended the forum said they came away with a keener understanding of today’s volatile economic landscape.
“The most powerful message was that the current paralysis in the markets cannot be chalked up to a mere liquidity crisis,” said Jane Prokop, chief strategy officer at Northern Leasing Systems, Inc., who is a Women’s Bond Club member. “There are very serious long-term structural and credit issues underlying the turbulence. It will take several years to work through them.”
Irina Avtsin, relationship manager in Private Banking USA for Credit Suisse Securities (USA) L.L.C., posed an intriguing query to conclude the proceedings: Where would each panelist invest if they were cashing a winning $10 million lottery ticket?
Three of the five who chose had the same answer: cash.
“Without a doubt, cash is king right now,” Professor Roubini said. “Increasing risk is something you have to be very careful about in these markets. If this isn’t a bubble, I don’t know what is.”
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