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The first half of 2022 has seen the worst performance for equities and bonds since the 1970s. Sentiment is being driven by a confluence of factors – aggressive rate hikes from the Fed to tame high inflation, debate over whether we’re in a recession, perpetual supply chain issues, and geopolitical events. This has all led to stark declines in valuations and deal activity and has filtered into the areas of private equity, credit, crypto, venture capital, housing and more. So what phase of the downturn are we in? Are investors in for more pain in 2022? And where does one put money to work in this challenging environment?
Powered by Bloomberg’s unrivaled data and analyses, Bloomberg Invest New York will help institutional investors and finance professionals navigate the volatility and ever-changing nature of today’s markets. Join us for mainstage in-depth discussions and dynamic networking as we focus on the challenges and opportunities posed by today’s rapidly changing financial and economic landscape.
The Fed's Mission to Fight Inflation
With inflation still near 40-year highs, the Fed's challenge of navigating a soft landing is becoming ever more complicated as it executes a highly sensitive mission that includes increasing benchmark interest rates this summer. Some investors are saying that the ship has already sailed, and the only way to cool the economy is with more aggressive monetary policy or with a dramatic economic decline. Can confidence in the economy and markets be restored or should investors brace for prolonged pain and a hard landing?
More Market Pain in 2022?
A string of economic shocks, led by high inflation, have rattled global markets and investors alike. Earlier this year, high profile names in finance said they were bracing for a “hurricane” and called “the confluence of shocks to the system unprecedented.” So where are investors finding opportunities in this current environment? Is it time to sit on the sidelines or are there places to put capital to work? How long will the downturn last and where are some of the biggest names in investing searching for signs of a bottom?
The Private Credit Cycle
Private debt has been one of the biggest winners of the last decade and has grown tenfold, with direct lending, distressed debt, and venture debt leading the financing structures. While many see this sector as more insulated from the recent volatility, rising rates, tightening conditions, and recession calls are cause for questioning where we are in this cycle. Regulators and industry watchdogs have long flagged concerns about the risks that lurk within the often-opaque market but its resilience in the last few years has many investors still seeing large growth pockets.
The Outlook and Appetite for Privates
The drop in valuations of public companies, led by technology, continues to make it harder for private startups to justify their once lofty price tags. VC firms are slowing their commitments to new deals, IPO activity dropped dramatically in the first half of the year, and SPAC issuers continue to struggle to find a match. But has the current reckoning just brought the marketplace down to more realistic levels? Will an era of easy money ending lead to better due diligence or change the way investors look to allocate capital across privates?
Advancing Sustainable Investing
Amid a slew of macroeconomic headwinds, flows into sustainable funds fared better than the broader market this year, suggesting investors may be more likely to stay the course during tough times. At this point, investors collectively understand the need to maximize purpose and profits to foster a more sustainable future, however more data standardization and regulation is needed. Where does further investment and innovation need to take place to help speed up progress? From the perspectives of the big money managers, to those focused solely in the ESG space, we’ll address how today’s investors are managing risk, bolstering climate resilience, and putting money to work amid the global energy transition.
The Institutional Take on Crypto
Institutional adoption of crypto has been slow, but we've seen many shops and notable investors warm to it as a burgeoning asset class in the last few years. However, the most recent rout, sparked by recession fears and the collapse of the third largest stable coin, has led to further liquidity events and called into question its place in portfolios and the broader investment landscape. What will it take to restore confidence in digital assets? Will further regulation help or hurt the sector? And whether it be tokens, blockchain technology, or broader DeFi, where do investors see bright spots and the smart money moving?