New Mid-Year Report Discusses Global Macro Trends
NEW YORK–(BUSINESS WIRE)–
KKR, a leading global investment firm, today released Adult Swim
Only: Mid-Year Update, a new mid-year global macro trends report by
Henry H. McVey, KKR’s Head of Global Macro and Asset Allocation (“GMAA”).
“It definitely feels like 2016 has emerged as a year of ‘Adult Swim
Only,’” Henry McVey said. “Markets have cut a wide swath so far this
year, enticing investors to buy and/or sell often at what was – in
hindsight – likely the time to do the exact opposite of what one’s
emotional core was suggesting. We stick to our base case that we remain
in an ‘Adult
Swim Only’ investment environment, as we see more asynchronous
growth ahead. Against this backdrop, however, we still see significant
opportunity.”
Highlights from the report include:
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1.
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Despite the negative overhang of Brexit, we are not yet calling for
a recession and/or bear market. However, we still see more limited
upside to financial asset appreciation than in prior years – and
with higher volatility.
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2.
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Given the shift towards negative interest rates and ongoing and
intensifying regulation of the banks, we are seeing a major spike in
opportunities in the mezzanine and asset-based lending areas of the
global economy, Europe in particular.
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3.
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More than ever, we feel confident about our outsized bet across
Private Credit.
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4.
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We continue to favor Real Assets with yield and growth, but we also
think that certain commodities are bottoming.
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5.
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We no longer see any rate increases in 2016, which also has
implications for the U.S. dollar.
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6.
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The investment community now better appreciates that there are
limits to central bank intervention, negative rates in particular.
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Links to access this note as well as an archive of Henry McVey’s
previous publications follow:
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To read the latest Insights: click here.
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To download a PDF version: click here.
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To download the KKR Insights app on iTunes: click here.
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For an archive of previous publications of Insights and Thoughts From
the Road: click here.
About Henry McVey
Henry H. McVey (New York) joined KKR in 2011 and is Head of the Global
Macro and Asset Allocation team. Mr. McVey also serves as Chief
Investment Officer for the Firm’s Balance Sheet. Prior to joining KKR,
Mr. McVey was a managing director, lead portfolio manager and head of
global macro and asset allocation at Morgan Stanley Investment
Management (MSIM). Prior to that, he was a portfolio manager at Fortress
Investment Group and chief U.S. investment strategist for Morgan
Stanley. While at Morgan Stanley, Mr. McVey was also a member of the
asset allocation committee, and the top ranked asset management and
brokerage analyst by Institutional Investor for four consecutive years
before becoming the firm’s strategist. He earned his B.A. from the
University of Virginia and an M.B.A. from the Wharton School of the
University of Pennsylvania. Mr. McVey serves as co-chair of the TEAK
Fellowship board of trustees and is a member of the Pritzker Foundation
and Lincoln Center Investment Committees.
About KKR
KKR is a leading global investment firm that manages investments across
multiple asset classes including private equity, energy, infrastructure,
real estate, credit and hedge funds. KKR aims to generate attractive
investment returns by following a patient and disciplined investment
approach, employing world‐class people, and driving growth and value
creation at the asset level. KKR invests its own capital alongside its
partners’ capital and brings opportunities to others through its capital
markets business. References to KKR’s investments may include the
activities of its sponsored funds. For additional information about KKR
& Co. L.P. (NYSE:KKR), please visit KKR’s website at www.kkr.com
and on Twitter @KKR_Co.
The views expressed herein are the personal views of Henry McVey of
KKR, as Head of the Global Macro and Asset Allocation, and
do not necessarily reflect the views of KKR. References to “we”, “us,”
and “our” refer to Mr. McVey and/or KKR’s Global Macro and Asset
Allocation team, as context requires, and not to KKR. This information
is not research and should not be treated as research. It does not
represent valuation judgments with respect to any financial instrument,
issuer, security or sector that may be described or referenced herein
and does not represent a formal or official view of KKR. It is being
provided merely to provide a framework to assist in the implementation
of an investor’s own analysis and an investor’s own views on the topic
discussed herein. There can be no assurance that an investment strategy
will be successful. Historic market trends are not reliable
indicators of actual future market behavior or future performance of any
particular investment which may differ materially, and should not be
relied upon as such. This information should not be viewed
as a current or past recommendation or a solicitation of an offer to buy
or sell any securities or to adopt any investment strategy. References
to a target portfolio and allocations are hypothetical allocation of
assets and not reflect an actual portfolio. The views expressed herein
and discussion of any target portfolio or allocations may not be
reflected in the strategies and products that KKR offers or invests,
including strategies and products to which Mr. McVey provides investment
advice to or on behalf of KKR. It should not be assumed that Mr. McVey
has made or will make investment recommendations in the future that are
consistent with the views expressed herein, or use any or all of the
techniques or methods of analysis described herein in managing client or
proprietary accounts. This release may contain projections or other
forward‐looking statements. Neither KKR nor Mr. McVey assumes any duty
to update such statements.
View source version on businesswire.com: http://www.businesswire.com/news/home/20160630005217/en/
Media:
KKR
Kristi Huller or Cara Kleiman
212-750-8300
media@kkr.com
Source: KKR & Co. L.P.