Much of the commentary about the Ukraine war’s implications for the investment-management industry has tended to be both immediate and narrow, particularly in discussions about the spillovers for different segments.
, the possibility of stagflation for the global economy was already a risk; and, at the other end of the probability distribution of potential outcomes, the upside scenario of high-growth and transitory inflation was declining., together with the pronounced politicisation and weaponizations of trade sanctions during the Trump administration, were serving as headwinds to continued globalisation and liberalisation of both economic and financial cross-border interactions.
Private markets offer the potential for flexibility that is needed in this more uncertain world. This includes a broader range of investment techniques, the scope for structural resilience that comes with explicit collateralization and smart structuring, a more appropriate pricing of liquidity, and the greater structural ability to stay in the trade during periods of unsettling volatility.
BS!