And that’s it - Delivering Alpha is finished for the day, but keep a look out on InstitutionalInvestor.com for videos, stories and slideshows related to the conference and the hours of investment insight it provided.
6pm:
Anne B. Popkin’s big idea? Levered credit is cheap—loans and high-yield bonds. But, she warns, volatility in this space will be high, so good risk management is crucial. “Don’t bet the ranch and [don’t] put all your money to work right away.”5:51: Loeb opts for Yahoo! As Imogen Rose-Smith points out, “Third Point is back in the activist game.” See our story by Stephen Taub last week that made precisely the same point .
5:45: Just Anne Popkin and Dan Loeb left.
5:40: Non-performing loans and mortgage-backed securites are the single best risk-ajusted investment out there right now, according to Tom Hill. Somewhere Greg Lippman is very happy, says Imogen Rose-Smith .
5:35: From Imogen Rose-Smith : “Falcone’s firm, Harbinger, owns Spectrum Brands through a publicly-traded entity called Harbinger Capital. He recently raised capital for HC from – among others – Peter Briger’s group at Fortress. This is interesting.”
5:30: It’s a big blow for Institutional Investor reporter and junior fortune teller Imogen Rose-Smith , who had earlier predicted that Phil Falcone’s best idea would be LightSquared - it is, in fact, Spectrum Brands. “I am crushed,” confesses Imogen.
5:25: Leon Cooperman’s best idea? Based on a few assumptions (Obama softens his anti-wealth stance, the Middle East remains stable) is ... [drumroll please] ... buy equities. “The market has figured out that growth will be slow. Stocks are at 11 to 12 times earnings when historically they’re at 15. Stocks are the best home in the neighborhood.”
5:20: First up, it’s Kyle Bass with his Japanese Finance Ministers Index. Nine finance ministers in the last few years (that’s them in the picture below, for those with vision problems). And counting. Short Japan is Bass’s idea.
5:15:
We’re on to the big one, the best ideas panel, where Philip Falcone (Harbinger Capital Investments), J Tomilson Hill (Blackstone Marketable Alternative Asset Management), Leon Cooperman (Omega Advisors), Anne Popkin (Symphony Asset Management), Dan Loeb (Third Point), Kyle Bass (Hayman Advisors) will present and defend their best ideas.5:08: Time for a contrarian view on Greece from Boaz Weinstein via Imogen Rose-Smith - Saba recently bought 1 year Greek bonds at approximately 35 cents on the dollar. It is not, Weinstein says, that Greece should not or will not eventualy default. But two or three year bonds trading in the low 30s and one year bonds trading in the high 30s “present interesting odds right now.”
Hardly a ringing endorsement.
5:03: Hedge funds are providing liquidity to the entire fixed income market. Now that the big banks are constrained in their ability to take risks, hedge funds are picking up the slack.
5:00: According to Boaz Weinstein, the banks inability and unwillingness to take on risk are contributing to price depression in the loan market. Because banks can’t take that risk onto their books if an investor wants to sell, they have to find a buyer. Banks, in other words, are not acting as liquidity providers.
4:50: Peter Briger versus the Treasury Secretary:
The solution to the debt and bank crises in Europe has to be “overwhelming” and “all encompassing” according to Peter Briger because “there are so few independent agencies out there that people trust.” In other words, there is so much skepticism about the institutions and people seeking to save Europe and the ability to get it done that the fix will have to be radical.
An interesting contrast with what Geithner said this morning which was, in effect, “they are working through it.”
4:47: Some classic Boaz Weinstein advice on investing in Europe: “Go long sovereign debt and short bank debt. The bank is more likely to default than the sovereign.”
4:45: Bruce Richards of Marathon again: “We need to use the same playbook we used in the U.S. to save Europe. There’s a rip at the fabric everyday. Bank debt has to be guaranteed by each of their countries. Geithner is going there now and I’m sure he’s going to be briefing them on the play book.”
4:40: They ran the first marathon between Marathon and Athens in Greece. Which probably has no bearing on Bruce Richards of Marathon Asset Management describing Greece as “the motherlode of distressed opportunities.”
4:39: After some brief levity, it’s back to the misery: “The banks [in Europe] don’t have the capital.” And no one wants to talk about it. That’s the casually-attired Marc Lasry agreeing with Peter Briger’s assessment of the state of the banking system in Europe.
4:35: Nevertheless, Imogen has time for some sartorial commentary: “Sporting the smart casual dress code so favored by some hedge fund managers. Would it have killed you to wear a suit Marc?”
Ouch.
4:32: A few minutes ago, II reporter Imogen Rose-Smith was looking forward to this panel. Seems like the weight of the world’s credit problems have got to her. “Got to love the credit guys,” she says, “bringing the happy.” The offending comment? Boaz Weinstein pointing out that “there is no confidence about the financial system in Europe.”
4:30: “If Greece defaults, it’s a nightmare. Everyone understands that but the question is whether Germany wants to keep sending money to Greece.” That’s the view of Marc Lasrey.
4:25: But before that, Imogen has a quick prediction for the ideas panel coming up at around 5pm -
Kyle Bass - Gold
Phil Falcone - LightSquared
Dan Loeb - Obama bad
Anyone got any other predictions? Care to put your money where your mouth is? Send them to comments@institutionalinvestor.com
4:24: We’re done with real estate and on to ‘Credit: The Coming Crisis’Institutional Investor reporter Imogen Rose-Smith says, “Another panel I’ve been looking forward to. Pete Briger, Boaz
Weinstein, Mark Lasry and Bruce Richards. A really strong line up.”
4:20:
Question - Would things be better if change in White House?Sam replies, “I thought Jimmy Carter was bad. Things can’t get any worse.”
Barry says, “We have a long-term problem with our labor force. There will be an ROI if we spend $250 billion on education and training for new jobs. We need to fix the heart of the issue. We need leadership. We have a community organizer who is acting like a community organizer.” [Institutional Investor senior editor Jay Akasie points out that Barry S is a Democrat!]
Sam Z, says, “Anybody but Obama!”
Very little room for misinterpretation there.
4:00: Sam Zell says, “You can’t create a REIT unless you’re dealing with income producing properties. You have to buy or work our an arrangement or Fannie/Freddy. Converting existing owenrs to renters. The challenge is how you run that business. You have to get the scale. Can’t have a business with 100 or 200 houses. The good news is lots of scale out there. Can you generate an income level of 7 percent returm? If done correctly, there would be massive interest. It’s patriotism -- come help solve the problem. Also, where will house prices be 5 years from now? Most people opt for up at this point. If you believe measurable recovery in short period of time, that’s a good opportunity. Barry replies, “That’s the difference between us and Japan. We grow. We need a lot more single fmaily homes. People clearing land in Orlando because there’s job creation there. But if there’s too much interference, the market won’t clear.”
Bill Ackman chimes in, “You can buy shopping mall REITS still at 6 percent yields. Mall cap rates were at 5 when rates were at nine. It’s an inflation-protected investment.”
3:55: Barry Sternlicht agrees: “Rookie discussion on home mortgagges. There actually is a demand for homes. The problem is with all the short sales, buyers can’t get approvals to get mortgages, and that’s what the government doesn’t get. They have to figure out how to stabilize the housing markets. Housing is the backbone of the US society’s confidence. The government has to come up with a different solution.”
Bill Ackman: “One thing gov COULD facilitate is single family homes. Buying single family homes and leasing them. There’s lots of institutional money looking for yield. Equatiize debt of Fannie and Freddy and you’d employ a half million people.”
Barry: “That’s the idea -- taking the supply out to boost confidence of consumers.” 3:50: Sam Zell says the government should undo what they’ve done so far. Government is never efficient, he says. They should focus on foreign affairs. Don’t enter free markets, he says.
3:45:
Another audience poll. This time the audience thinks we have a year or more to work through the real estate slump.3:40: And on to real estate, where we have Bill Ackman (Pershing Square), Sam Zell (Equity Group Investments), and Barry Sternlicht (Starwood Capital Group) deciding whether it’s time to return to the real estate market.
3:34: From the floor - audience poll on the price of gold ended as follows: 34 percent of audience thought gold will be lower vs. 33 percent polled thinking higher.
3:30: Paul T: “Ten year TIPS are at zero. Market’s worried about recession. But there also isn’t rational people -- they’re acting out of fear and a flight to safety.”3:25:
Jeff Scott: “Financial crises typically take a long time to get out of. At this point in time, you need to be thinking about deflationary and inflationary aspects in terms of angling your portfolio for the long-term.”3:23: A deficit of oil and headed to $200 a barrel. According to Paul T, “New natural gas exploration has shown more potential in US than Saudi Arabia has known oil. That will take time and a distribution system. This will be good for the transportation sector - converting all those vehicles to natural gas.”
3:20: From Institutional Investor reporter Imogen Rose-Smith : Paul Touradji “is a long-term gold bull. Which actually suprises me a little.”
3:19: The Alaskan taxi driver is the new, politically-correct version of the shoeshine boy. At least according to Jeff Scott: “We were surpirsed at audience vote on gold just now. If you’re in a taxi cab in Alaska and he asks you about gold, it makes me nervous. True story -- this happened to me. It means the pubic is piling into gold. I have trustees telling me we should be in gold.”
3:15: Did Paul Touradji just call Larry Fink useless? No, not quite. What he actually said was: “I’m heartned to hear Larry Fink’s take on gold equities - $2,500 and a lot higher a year from now. But to put a price on it when it’s in a phase like this, it’s useless. I agree with Soros that it will soon be in a bubble.”3:04:
Commodities and emerging markets:Paul says, “The story of commodities going forward is in the emerging markets.”
Jeff says, “In emerging markets, they’re lowering interest rates (in Brazil) because worried about growth. So weak growth now in emerging markets so in theory commodities prices should fall.”
3:02:
From Institutional Investor senior editor Jay Akasie : “My old friend Kate Kelly, the CNBC moderator of this session, is having a baby in two weeks. Congratulations, Kate!” Is it her first? Because that really would be Delivering Alpha. Geddit?3:00: And that wraps it up for the battle of the bull versus the bear. On to commodities, where we have Peter Gilbert (chief investment officer at Lehigh University), Jeff Scott (CIO at Wurts & Associates), and Paul Touradji (Touradji Capital).
2:58: Shake hands with Chinese trade - Buy multinationals with fast growing revenues from China, says Arbess.
2:57: It’s getting interesting. In China, says Arbess, there are not enough protections. But, to Chanos’s dismay, Arbess says he’ll buy equity. Arbess’s defense? More upside.
2:56: What is the short-property-long-corruption trade? Chanos explains that they’re short “some Chinese property developers” and “some banks” and long casinos. Capiche?
2:48: Chinese ghost cities are a red herring, says Arbess. Yes, there is speculation but policy makers are dealing with that by reining in credit and putting the kibosh on owning multiple homes. More important is that 20 to 30 million people are moving to the cities and filling up these developments.
2:46: Arbess and Chanos agree on three things so far. The three issues in Chinese investing are: real estate; financial system; and the dependency on fixed assets.2:44:
“To short China in general is to short the march of history. The single most important event of our lives is the devolution of communism.” A small gem from Dan Arbess. 2:39: The first casualty is neither Chanos nor Arbess, though - it’s poor old Bill ‘100 Slide’ Ackman. Chanos says he was ‘waiting for the endless presentation to finish at lunch.’ At least Ackman saw the funny side.
2:38:
If that didn’t make any sense, here’s a quick clarification. The next panel is entitled China: Bubble or Bonanza. It’s Dan Arbess of Perella Weinberg Partners versus Jim Chanos of Kynikos Associates.2:36:
From Institutional Investor reporter Imogen Rose-Smith , before the China: Bubble or Bonanza panel: “Chanos v Arbes on China. The Bear v the Bull. I’ve been looking forward to this panel. I know I need to get out more.”2:10: If you think lunch is just lunch at Delivering Alpha, you’re wrong. It is in fact a 100 slide presentation by Bill Ackman - the big takeaway? Buy Hong Kong dollars. Ackman also expresses a like for call options and has structured some very interesting trades that way, including his Target investment.
1:30: If you don’t like wading through the written transcript, why not go to the Institutional Investor home page and watch the full video instead?
12:55: And that’s lunch. In case you missed the morning session, here’s a full transcript of the interview with Treasury Secretary Timothy Geithner.
12:50: Some cosmic thinking from Alice and Ash:
Ash: “Timeframe of investing. Nobody in this room is on a 60-day horizon. We’re looking 50 years out. Then it’s just not the time to say the world has changed. The world is always changing but also experiencing a re-birth.”
Alice: “We long-term investors will never hit bottom and never hit the top. It’s what being a long-term investor is all about.”
Think about it, man.
12:44: For Rick Sopher, the “biggest question in investing today, if you can get around the skids, are equities. They are arithmetically cheap opportunities. What we’re not doing is to give up on analysis.”
12:41:
Tomas of AP2 says, “We are trying to keep our return expectations with a diversified portfolio. Investments in agriculture and timber, for example. Selling domestic equities and buying trees. But we’re not buying Nordic trees. We’re looking into forests in Australia, New Zealand, and Brazil.” Ash Williams is doing timber, too. “We also bought some wine grape holdings in California. All sorts of agricultural holdings.” Institutional Investor senior editor Jay Akasie says, “I’ll drink to that investment strategy.” Presumably he’s not referring to the timber.12:39:
Rick Sopher agrees on the hedge funds: “We have been investing in hedge funds for 40 years. We look at amount of money in dollars that manager has made for his clients in fees. Since inception of hedge funds, the entire industry has made $557 billion for investors after fees. But within that amount, most came from investments in equity markets. It’s proof to us that hedge fund managers simply do equity investing better than the rest. I assume most of that is on the long side. Shorting equities is a hard game.”12:37: Ash Williams has some advice, too: “Hedge funds are great for opportunistic capital. Very good places to do it.” Long-term institutions, like Florida, are not good at looking around the corner and investing opportunistically - in part because they can’t
compete in the hiring market for that investment talent. “Hedge funds are a very good place to capture that opportunity.”
12: 36: It’s Alice Handy of Investure again, with some advice on strategy: “What to avoid is as important as what to invest in. Bonds just aren’t going to do it for us. Two percent? No thanks. So we’re going to the outlying edges of hedges to try to get better pricing on things. We are a resilient nation. Remember in the 1980s, when we were convinced that the Japanese model was the model of the future? We’ll they stagnated and we took off with the Internet. We don’t move out portfolios around a lot. You don’t just move that money around on a whim.”
12:35: Rick Sopher says: “There are signs of a bank run in the wholesale market in Europe. Surprised we haven’t seen a retail run. An awkward moment, to say the least. We’re coming to the end of the denial phase in Europe. Even at SocGen.”
12:30:
Back inside the minds of institutional investors. A broadside for politicans from Ash Williams: “Can we get through the short-term challenges without policymakers making long-term decisions that mess with our success? We need long-term discipline. The key is a well-considered strategy and an appropriate mix of assets. Global equities, fixed-income, hedge funds, real estate, and private equity.”
12:30:
Just a quick reminder of what else we’ve got coming up in today’s agenda . Still to come: bubble or bonanza in China?; what to do with commodities; is it time to get back into real estate; and, not for the fainthearted, the a high-powered panel of hedge fund managers defend their best ideas.12:26: Thomas from Sweden gives a European perspective: “What this is all about is to give breathing space for French and German banks. Is this the Euro’s fault? No. I’m not sure we need two Eurozones but there’s no formula on how to face these things.”
12:24: And it’s Alice to kick-off with a little insight into what upsets the sleep of institutional investors: “The same issues that kept us up at night last year are the ones keeping us up now. Mediocre returns in the market worry us. How best to deal with lower returns. Not to mention volatility. It really wears you down. Lastly, fees matter. How do you keep up?”
12:20: Emerging markets was short and sweet. Now it’s time to delve into the minds of today’s institutional investors. We’ve got Rick Sopher (LCH Investments), Ash Williams (Florida State Board of Administration), Alice Handy (Investure), and Tomas Franzen (Second Swedish National Pension Fund - AP2).
12:22: Marty Whitman’s biggest problem? “I understand the U.S. culture better than any emerging market despite an office in Singapore.”
12:20: Tom Buerkle asks the question: “What would make you reassess your investments in emerging markets?” Marty Whitman gives his answer: “If we’re going to reassess our investments it won’t be for economic reasons. It will be for political reasons or social unrest. If 400 to 500 million Chinese move into the middle class then we’ll have social unrest.”
12:13: Martin Whitman is moving more toward emerging markets. Tom Buerkle asks whether he has had to change his approach? “No we’re Graham & Dodd on steroids.” In emerging markets, Marty looks for stocks whose issuers have super strong financials, have huge discounts from 25 percent to 60 percent and offer full disclosure. In English!
12:09: Marko D says: “We’re diversified well because of political and other risks so we have investments in 28 countries. But were overweight in Qatar and Bangladesh which we think is a new power in low cost manufacturing.” 'We,’ if you’ve forgotten are Marko’s firm, Everest Capital.
12:05: Marko D (for brevity) says we definitely won’t see acceleration in emerging markets. Growth will taper off in places like China but will still be fairly high. But frontier markets will be very growthful. Most people think BRICs, but non-BRICs represent 27 percent of world GDP. That’s bigger than the U.S. economy.11:55:
Which wraps up the solving the deficit panel. It promised all perspicacity, no politics. We’ll leave that to the reader to judge. Up next, are emerging markets a bubble? Tom Buerkle, Institutional Investor’s international editor, speaks to Marko Dimitrijevic (Everest Capital), Scott Kalb (Korea Investment Corp), and Martin J. Whitman (Third Avenue Management).11:48: Corzine says he is optimistic. But there’s a caveat. “The senior Republican and president were close to a big agreement this summer. They should have seized the moment. It won’t be a slam dunk.”
11:47: A few minutes after some pretty impressive political rhetoric himself, Damon Silvers says that ideological disputes are preventing us from being competitive. Countries that are competitive have figured out how to come together. Pubic sector and private sector. Shame on all of us if we don’t.
11:44: Emil Henry: “We introduced the 30-year bond when I was at the Treasury. We should explore a 50-year bond. The Treasury is always reluctant because they want to be the most liquid in the world.” Institutional Investor senior editor Jay Akasie says: “Everyone get in line to snap up those 50-year bonds!!!”
11:42: Corzine wants a simpler tax system: “This country was much more productive when we had much less complication to the tax code. People should be willing to accept a restructuring of the tax code. We’re closing down NASA, one of the great drivers of the modern tech revolution. It makes no sense. We need to get back to a sense of common responsibility for each other. So we need to restructure out tax code.”
11:39: Damon Silvers defends Medicare again, rounding on the ‘elites’ in the conference: “It’s only in this room that people can say with a straight face that you can cut Medicare. This is a responsibility of America’s elites, both on this panel and in this room. If you want to fund tax breaks for bank bail-outs and energy companies and then go cut off healthcare to elderly Americans, think about country you are building. It will become what Brazil used to be, where houses go up with gates and guns. Is this the country you want to create?11:35:
Tom Steyer: “Massive political dysfunction in this country [but] at least we’re doing the right thing after we’ve exhausted all other avenues.”11:26: Panelist Damon Silvers, of the American Federation of Labor and Congress of Industrial Organizations, says: Social Security is not a serious problem. Healthcare costs throughout the economy is. Weakening Medicare will make things worse.
11:24: Tom Steyer: “I’m form California, and we went bust five years ago. Since WW2, revenues for the federal government have ranked between 17 and 22 percent. Now we’re down around 15 percent. We need to accept that fact, that people don’t trust government anymore. They won’t allow the things government wants to do. Extreme stagnation of incomes of Americans is hurting us.”
11:21: Jon Corzine - we need to push for energy independence; we need to reform the tax code so that there aren’t winners and losers; regulations aren’t the problem, jobs are the problem. “People are in the hole and we need to do something about that.”
11:20: Emil Henry: “I really like Tim Geithner, but I haven’t seen a single growth policy out of the Obama administration. Growth means lower taxes. Not Dodd Frank, which is in the face of business. Free trade agreements are critical for growth. Buts Dems have held this hostage because of big labor ties.”
11:17: Tom Steyer: “Is there a chill-out message form the Treasury market? People keep analogizing this market to other post-WW2 recessions. There are a couple of things different this time. Housing and car sales brought us out of past recessions. That’s not going to happen this time around. People still think it’s going to be like past recessions ... Compounding interest, when you’re in a bad situation, works against you. It’s not 1952 anymore.”
11:15: John Corzine, former governor of New Jersey, senator from New Jersey, and co-honcho of Goldman Sachs, says if we don’t grow the economy we won’t grow jobs. A huge deficit in demand is creating this gap. What we see happening in Europe with austerity programs is the accumulation of weakness.
11:10: Emil Henry says “This is very serious if we don’t deal with it very soon. It’s heading into the category of the so-called pigs. Our true debt is $75 trillion. Entitlements are a huge problem and we need to address the issue.”
11:05: A quick electronic vote discovers that the majority of the audience thinks that a “balanced approach” is more important to solving the deficit crisis than either “raising revenue” or “cutting spending.”
11:00: After a quick coffee break, it’s back to the conference, this time it’s solving the deficit problem with Thomas F. Steyer (Farallon Capital Management), Jon Corzine (MF Global), and Emil W. Henry (Henry, Tiger).
10:28: Ted Seides points out that roughly 80 percent of all money in hedge funds is in the same couple of hundred firms. Ergo, many people are just following the same set of investment strategies.
10:25: Cliff Asness says investors need to ask managers about three things: Are they delivering true alpha, beta, or something in the middle?10:19:
From Institutional Investor reporter Julie Segal . “Most repeated quote: the best and the brightest are in or moving to hedge funds.”10:20: Ted Seides gives a shout out to Institutional Investor’s annual ranking of the rising stars of hedge funds . Want to see what he’s talking about? It’s all here .
10:04: What’s up next? Fees. Can hedge fund managers really deliver enough alpha to justify their 2 and 20 fees? You’re about to find out. Here to answer questions from Institutional Investor editor Michael Peltz are Steven Algert (J. Paul Getty Trust), Clifford S. Asness (AQR Capital Management), Jonathon S. Jacobson (Highfields Capital Management), and Ted Seides (Protoge Partners).
10:02:
What won’t you touch? Meredith Whitney won’t touch the big banks. Best case - they atrophy. Worst case - they’re shrinking.9:59: Jim Leech - the rise of the east is positive. It’s helped us but we need more changes in legal and other areas before we rush in with money.
9:52: Fink’s hogging the show, it would seem. Here he is on Europe:
“This is binary, there is nothing granular about this. And that is what scares investors right now.
“Our memories are very short. We can’t afford as investors to invest in things that are quite binary right now.”
He agreed with comments Geithner made earlier about Europe, saying, “We are going to see [in the near future] very large government involvement to stabilize the situation.”
9:47: Fink, one of the worlds biggest bond fund managers, says the crisis of the future will be underinvesting. “Pension funds can’t meet their long term liability on 2 percent bonds.” Blackrock is counseling institutional investors to look at equity markets. “You can buy great assets today and be rewarded in 10 years. Of course, you might be able to pick them up at 10 to 20% cheaper but it’s hard to invest at the bottom.”
9:46: Fink - “It’s the 70s again.”
9:42: Agree? Disagree? Got something you want to get off your chest? comments@institutionalinvestor.com .
9:38: Larry Fink on sovereign wealth funds: “Sovereign wealth funds are biased toward more global investing right now, less dollar-based investing.” But “we have seen no slow down from sovereign wealth funds in terms of investing.” And they are looking opportunistically at the U.S.
9:36: According to Pierre Lagrange, “the fundamentals do work in the oil sector right now.”
9:31: Meredith Whitney on asset managers: “The valuations of asset managers today are at a level I never thought I’d experince in my life time,” with which Larry Fink agrees. “They’re about to get even more attractive,” she continues.
9:25: Maria Bartiromo: Is Greece in default?
Larry Fink: I don’t know what your definition of default is.
Bill Ackman, in the audience, finds this very funny indeed.
9:24: Jim Leech prefers investing in America - he won’t go overboard in China. 50 percent of the revenues of multinationals come from overseas. “It’s foolish think the investing solution is in China.”
9:22: Maria Bartiromo asks Larry Fink of BlackRock what ‘the new normal’ means. Fink says it’s a myth to think that all jobs are being created overseas. “When companies sell products overseas the R&D is here. Global growth is positive as the middle class is growing around the world. Well have a better world.”
9:18: So, is it the end of America? According to Meredith Whitney, “You have incredible opportunities that are occurring outside of the U.S. that help the U.S. get out of its morass.” Such as global growth and economic development in China.
9:10: Got something you want to say? Email comments@institutionalinvestor.com .
9:09: For the full program, see here.
9:02: Geithner steps down. But there’s much more to come. Next up, Larry Fink (Blackrock), Jim Leech (Ontario Teachers’ Pension Plan), Pierre Lagrange (GLG Partners), and Meredith Whitney of the Meredith Whitney Advisory Group. They’ll be discussing whether this is the end of America.
9:01: Cramer: “Nothing gets done in Washington because everyone is afraid of getting fired. Are you afraid of getting fired?” Geithner: “I was hoping,” to laughter in the audience. But he went on to say the test of holding public office is a willingness to be candid about our problems which he says he has always done.
9:00: Three years from now, Europe will be very much alive. “They have committed a generation of political capital to building” the institution of Europe. They have moved over the last 18 months to compensate for the gaps in the system.
8:55: To the question, is oil being by carteled by hedge funds - “Oil is driven by fundamentals. Financial activity can amplify prices but prices have come down enough that they won’t be a constraint on growth.”
8:52: Holding credit default swaps on things we do not own should “absolutely not” be outlawed.
8:49: The jobs plan is conservative and prudent, says Geithner. Think about it as protection against Europe. If you have better ideas tell me.” He adds, ""President’s jobs plan is NOT dead-on-arrival, as some say.”
8:44: Institutional Investor reporter Imogen Rose-Smith disagrees with Geithner over his belief that the U.S. is in a better position than the rest of the world, particularly Europe, in terms of getting its fiscal house in order. “I was speaking last night to a global macro hedge fund manager based in Europe who compleatly disagrees - he thinks the U.S. is in worse shape it just isn’t being recognized as such.”
8:40: “There is no chance that the majour countries in Europe will let their institutions be at risk in the eyes of the market.” In other words a Lehman will not happen in Europe.
8:39: Europe recognizes the need for more complete fiscal union, says Geithner.
8:38:
Europe is in some difficulty, according to Geithner. And it’s important that Germany is vowing to help hold Europe together.8:35: Geithner takes to the podium with CNBC’s Jim Cramer.
8:30: We’ve spotted Bill Ackman in the audience waiting patiently for Tim Geithner. Ackman will be making a major announcement at 1.30pm - don’t miss it.
See the full program for today’s events. Check back regularly for updates.
Are hedge fund fees justified?
Is the U.S.’s reign as a superpower finished?
Are emerging markets just a bubble?
Can the U.S. government solve the deficit problem?
A diverse set of questions but Institutional Investor, working with CNBC, will have all the answers today at Delivering Alpha, a unique one-day meeting composed entirely of the best-known hedge fund managers and the largest investors globally.
U.S. Treasury Secretary Tim Geithner will be weighing-in, as well as hedge fund managers such as William Ackman, Pierre Lagrange, Dan Loeb and Leon Cooperman, not to mention Blackrock chairman Larry Fink, Ontario Teachers’ Fund president Jim Leech and a plethora of others.
On the Institutional Investor website we’ll be running a full, running commentary of every statement, every insight and every piece of wisdom dispensed at the conference.
Live blogging will begin at 8am on Wednesday morning.
