Cash on the Sidelines: How to Unleash $30 Trillion
Tuesday, April 30, 2013 / 10:45 am - 11:45 am
Joe Reece, Managing Director, Investment Banking, and Global Head, Equity Capital Markets, Credit Suisse
Alexandra Lebenthal, President and CEO, Lebenthal & Company
Mustafa Sagun, Chief Investment Officer, Principal Global Investors
Max Stone, Managing Director and Executive Committee Member, The D. E. Shaw Group
James Zelter , Managing Partner, Apollo Capital Management; CEO, Apollo Investment Corp.
There is, by some estimates, at least $30 trillion sitting on the sidelines globally earning less than 1 percent. Risk-off sentiment has kept most of this liquidity out of the markets - with no apparent strategy or timeframe for being channeled into more productive use and better returns. Even with relatively benign inflation, the real return on this staggering amount of capital is negative. In 2012, the equity markets saw greater outflows than even 2008, the crux of the financial crisis. Investors bypassed double-digit gains as a result. What are they thinking now? Are new financial models needed? Are new allocation strategies coming? Will the fatigue of low returns raise investors' risk tolerance, or will the lingering hangover from the crisis keep them paralyzed? With corporations, institutional investors and sovereign wealth funds still hoarding cash, our panel will consider what might trigger the deployment of this capital toward building the future.