Welcome to Mercer's investment consulting news room dedicated to ongoing economic events
In light of the recent market volatilty, Mercer's investment consulting business provides insightful thought pieces exploring issues and opportunities. Read more about rigorous strategic planning, principles for success and proactive business measures.
Opportunity knocks?
In our recent article on Mercer.com, “Has the music stopped?” we suggested that the current market dislocation may have presented long term investors with a number of interesting, nay compelling, investment opportunities.
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Global perspective: Has the music stopped?
A fund manager recently noted that you know that things are bad when people start quoting Churchill (or Warren Buffet for that matter). For a number of years some of the astute commentators have been expressing concerns about the credit excesses, the global imbalances and warning that we will rue the day when the excesses unwind.
Beyond the credit crisis: The role of pension funds in moving to a more sustainable capital market
12 January 2009
We are in the midst of a seemingly unprecedented financial crisis, one that may threaten the very core of the capital market system and our trust in its ability to provide credit to fund expansion and growth in the global economy. The focus for governments, central bankers, investors, corporations and individuals around the world today is rightly on responding to the immediate crisis at hand.
Americas
DC Quick Survey Results
December 2008
Mercer has released results from its latest Defined Contribution Quick Survey examining plan sponsor and participant reactions to the current financial crisis. Given the current market conditions, Mercer will continue to monitor these issues. Although we believe only a small percentage of companies have suspended their match, a larger number are considering it and new announcements of suspended matching contributions continue to appear in the media. Meanwhile participants are accessing their accounts at a higher than normal rate.
UPDATE: Turbulent financial markets: Impact on DC plans
10 October 2008
The current financial market turmoil has important implications for defined contribution (DC) programs. Plan sponsors and fiduciaries should quickly determine whether action is needed in response to these extraordinary conditions, or if maintaining the present course might be more prudent. Plan sponsors should also consider whether drafting a communication to participants, to address concerns and reinforce key messages, is needed.
Broken-Buck mountain
19 September 2008
The cash market, already stressed from problems with SIVs (Structured Investment Vehicles), auction rate securities, and asset-backed commercial paper, suddenly encountered its worst nightmare: an actual default of a major commercial paper issuer, Lehman Brothers. Fears of other defaults and the scramble to prepare for client redemptions created a massive flight-to-quality with Treasury bill yields driven down to 2 basis points for a period this week.
Securites Lending Update
19 September 2008
Our initial evaluation of the current market environment has highlighted five common sources of losses to lenders.
Financial Market Update - Lehman, AIG, Merrill, Fannie and Freddie: Investment Implications
16 September 2008
The financial market turmoil that began in the spring of 2007 with the failure of two Bear Stearns hedge funds has expanded in a new and dramatic direction in the last ten days, engulfing not only the very government entities tasked with providing liquidity to the US mortgage market, but to two more the five investment banks that utilized easily available market liquidity to earn record profits for their shareholders.
Asia-Pacific
Capital Market Update - 13 October 2008
13 October 2008
As the turmoil engulfing the world’s financial markets continues in earnest, many investors are facing some of the worst investment performance results for decades.
Capital Market Update: Lehman, AIG, Merrill, Fannie and Freddie - Investment Implications
17 September 2008
The financial market turmoil that began in mid 2007 has expanded in a new and dramatic direction during the past ten days. Last week the US Treasury announced it would place two financial sector government-sponsored enterprises, FNMA (“Fannie Mae”) and FHLMC (“Freddie Mac”) under government control. On Sunday evening it was then announced that Lehman Brothers would declare bankruptcy and that Merrill Lynch had decided it was too weak to remain independent.
Europe
Economic crisis is creating new investment paradigm NEW
9 December 2009
The economic crisis has put in train the most dramatic changes in investor behaviours witnessed in generations, attendees will hear today at Mercer’s 7th European Investment Forum in Paris. Speaking in advance of the forum Tom Geraghty, Mercer’s European head of investment, said: “We believe that the events of the last few years will, in the future, be seen as the catalyst for a paradigm shift in the way we all invest. In fact, we can already see the economic crisis having a marked impact both on the way investors approach the markets and how we advise them.”
Market Turmoil in DC - where do we go from here?
8 January 2009
In recent months there has been no getting away from the headlines about the fall in equity markets and the impact it has had on defined contribution (DC) pension pots. Inevitably memebers have been concerned and call centres have been inundated with enquiries from anxious memebers, leading to trustees and sponsors asking what they can do. In this article we look at the concerns of the impact of the recent market fall to see if it really is as bad as DC members have been led to believe or whether the headlines could potentially trigger the real damage of memebrs taking actin and consolidating their loss. We also look at some of the initiatives trustees and sponsors could implement to alleviate some of these concerns both now and in the future.
Where next for hedge funds. Follow-up - the end of short selling?
23 October 2008
Following the collapse of Lehman Bros and the subsequent financial market turmoil, regulators around the globe introduced bans on “short selling” as part of their effort to calm the markets.
Unwinding of Infrastructure Funds
10 October 2008
In light of the recent negative headlines about the unwinding of some high profile infrastructure funds, this short note provides some background to these events, the impact of current credit market conditions on the outlook for the sector and how this affects investors in infrastructure.
Where next for hedge funds? The financial crisis and its implications
10 October 2008
The trend to diversify into alternative investments means that many investors now have allocations to hedge funds, either through active currency mandates, global tactical asset allocation (GTAA), long/short equity, or more “exotic” hedge fund strategies. The financial crisis will have had both a direct and indirect impact on investment managers and, in particular hedge funds.
Mercer is a leading global provider of investment consulting services, and offers customized guidance at every stage of the investment decision, risk management and investment monitoring process. We have been dedicated to meeting the needs of clients for more than 30 years, and we work with the fiduciaries of pension funds, foundations, endowments and other investors in some 35 countries. We assist with every aspect of institutional investing (and retail portfolios in some geographies), from strategy, structure and implementation to ongoing portfolio management. We create value through our commitment to thought leadership; world-class, independent research; and top-notch consultants with local expertise.
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