Two Faces of the Same Coin
London, UK - 10 August 2007, 21:57 GMT
Dear ATCA Colleagues
[Please note that the views presented by individual contributors are not
necessarily representative of the views of ATCA, which is neutral. ATCA conducts
collective Socratic dialogue on global opportunities and threats.]
We are grateful to:
. Dr George Feiger, based in Berkeley, California, USA, for "Two Faces
of the Same Coin;"
. The ATCA Editorial Team, based in Canary Wharf, London, for "Contagion
and Systemic Risk? ECB Injects Record Euro 95bn post Major Disturbance;"
. The ATCA Editorial Team, for "Flight to Quality
as Markets finally Appreciate Risk;"
. Robert McNally, Chairman, London Chamber of Commerce Property and Construction
Group, for "Erosion of Commercial Real Estate
as a Solid Asset Class;"
. Alexander Hoare, CEO, C Hoare and Co, Private Bankers, based in the City
of London, for "Destructive
Creativity, Leverage and The Derivatives Market;" and
. Dr Harald Malmgren, CEO, Malmgren Global, based in Washington, DC, for "The
Fear of Central Bankers -- Flight from Illiquidity, Derivatives and Heightened
Risk of Contagion;"
in response to, "Are the Currency Markets Warning
that there is Trouble Ahead? The Precipitous Decline of the US Dollar and
its Impact on the World."
Dr George Feiger is President and CEO of of Contango Capital Advisors, based
in Berkeley, California. He brings to the firm a diverse background in the
banking, financial services and wealth-management industries. He is also Executive
Vice President of the firm's parent company, Zions Bancorporation listed on
Nasdaq and based in Salt Lake City, Utah. Prior to Contango, Dr Feiger served
in a number of senior positions in the financial services sector. He was a
Senior Advisor to the Monitor Group, Global Head of Onshore Private Banking
for UBS, Global Head of Investment Banking at SBC Warburg and was a Senior
Partner at McKinsey & Co during his time in Europe. He led the merger
integration of the corporate finance businesses of Swiss Bank Corp and SG
Warburg, and oversaw the consolidation of SBC Warburg's sales and trading
businesses. He was also a partner at Capco, a financial services consulting
firm. He holds a PhD in Economics from Harvard University and was an Associate
Professor of Finance at Stanford University's Graduate School of Business.
He has served as a director on several corporate boards and is a frequent
writer and speaker on a wide range of financial topics. He writes:
Dear DK and Colleagues
Re: Two Faces of the Same Coin
It is time to use other language than "contagion" and "systemic
risk." We are now experiencing the fruits of every liberal economist's
dreams in the global capital markets, which can be summarized in the good
news/bad news dichotomy beloved of late night television humorists. First,
some facts that we should recognize about world financial markets:
These are two sides of the same coin. You can't have one without the other.
It is Milton Friedman's "there's no such thing as a free lunch".
And of course Lord Keynes recognized this also in many places in his works
where he wrote about investors and speculators. And to repeat, there is no
way that regulators can police this system effectively. They can, of course,
prevent great depressions and hyper inflations but that is about it.
Welcome to the ride!
We look forward to your further thoughts, observations and views. Thank
For and on behalf of DK Matai, Chairman, Asymmetric Threats Contingency
ATCA: The Asymmetric Threats Contingency
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The views presented by individual contributors are not necessarily
representative of the views of ATCA, which is neutral. Please
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