Institutional Investor (May 5)
“Institutional investors have a remedy for the mounting pile of public debt accumulating during the coronavirus crisis: Tax private equity.” In a recent survey 62% of respondents suggested “increasing taxes on private equity, carried interest or performance fees, and special purpose vehicles” as ways “their national governments should adjust tax policies to offset stimulus spending.”
Tags: Carried interest, Coronavirus, Crisis, Governments, Institutional, Investors, Performance fees, Private equity, Public debt, SPVs, Stimulus spending, Survey, Tax
IPE Real Assets (September/October Issue)
“Real estate is often said to be a long-term, buy-and-hold asset class for institutional investors. But the success of investments invariably comes down to getting the timing right.” Recently, “a handful of fund managers” have “sold to bigger parties, either fully or partially.” This raises the question whether the latest round of M&A is a signal. Though it is a “possible canary,” there are other reasons for M&A. The prevailing outlook amongst investors and managers is for “a supportive market environment in the short to medium term” and “an extended cycle, albeit a flat one in terms of capital value growth.”
Tags: Asset class, Buy-and-hold, Canary, Extended cycle, Fund managers, Institutional, Investors, M&A, Real estate, Timing, Value growth
Washington Post (September 8)
“Washington feels like the capital of an occupied country,” filled with “institutional and administrative chaos; our military chain of command is compromised; people around the elected president feel impelled to act above the law and remove papers from his desk. The mechanisms meant to protect the state from an incompetent or dictatorial president are not being used because people in power no longer believe in them, or are afraid to use them. Washington feels like the capital of a state where the legal order has collapsed.”
Tags: Administrative, Chain of command, Chaos, Collapsed, Dictatorial, Elected, Incompetent, Institutional, Law, Legal order, Military, Occupied, Power, President, Protect, Washington
Institutional Investor (May 15)
“The Cambrian explosion has nothing on institutional investing.” Rather than millions of years, institutional investing’s journey from small and simple to enormously complex took only half a century…. The unfortunate and ironic part is that all this innovation has done little to quell crises…. Underlying every instance of disaster is the same root: We simply do not know what we think we know.”
Tags: Cambrian, Complex, Crises, Disaster, Innovation, Institutional, Investing, Simple
Washington Post (July 11)
“The eclipse of the long-term shareholder has been accompanied by the eclipse of the individual shareholder.” Over 90% of shares in U.S. companies were held by individuals in the 1950s when the average share was held 7 years. Today, it’s about 30-35% and just 6 months. Institutional investors now make up the difference, but this raises some problems. “Investment funds that hold shares in many different companies often lack the resources to focus on a single corporation’s performance.” As such, they may not be properly fulfilling their role in ensuring effective corporate governance.
