Trésorier/Treasurer magazine - n°82 - July/Aug./Sept. 2013 - (Page 3)

EDITORIAL 5 years on The title sounds as if it might belong to the French writer Guillaume Musso’s latest novel. Sadly, five years after this economic crisis started, we can’t be sure that this story will have the fine, upbeat ending that we have come to expect from Musso. Until we find out how this story is going to end, nobody can claim – without the risk of seeming pretentious – to have predicted this economic scenario which could have come out of a Hitchcock film. Nobody! Five years of financial folly and incredible developments, and everything is still (unfortunately) up in the air, even the worst case scenario! But what do the next five years have in store for us? What more are we going to be hit with? We still need to tread very carefully. However, I think that things might be a little simpler. We now all know that while there’s life there’s hope. We know that swans can sometimes be black and that Murphy’s Law, combined with an ever tighter correlation effect, can lead to really complicated and dismal situations. Brilliant economists forecast that we will be in a «Japanese situation” for a long while yet. Others are convinced that Greece (and only Greece) will have left the Euro (and Cyprus, and…?). We are seeing a period of deflation with struggling banks, which have been restructured and are smaller. We could also conceive of a strong Deutsch Mark zone, with a number of satellites gravitating around it, like Luxembourg, Belgium, Austria, the Netherlands and France. A (more) European rating agency will be set up, but will struggle to make headway against the three giants (this is maybe wishful thinking). We will have to wait a bit yet before we see it emerge in 2020. So are we on track for another five years of crisis? Perhaps not. But we must not expect five years of growth or five easy years. It is a serious illness, with a long convalescence and the return to normal, or to what the new normal will be, will take longer still before we recover our full strength. It is like when you break a limb – the body never recovers 100% of its previous strength. The fracture here was a multiple fracture, deep and open. We need time, and many metal pins and plates (i.e. «regulations» and «effective controls») to make the limb straight and strong again. These will be five years of long and hard work, if the predictions of the financial soothsayer are to be believed. N°82 The conflict in Europe between national control as against European control will persist. In time, we can only see «more Europe» appear in the daily work of the control and supervision bodies or at the financial «super cop» level. If the financial system eventually stabilises with such measures, we may hope to have markets – stock markets and financial markets – that are better orientated and that again become «bullish» and optimistic. In the next five years, even the great German economy will see a slowdown and recession. At least low interest rates will allow the most virtuous and prudent countries to reduce their debt. They will also help the weakest banks. We are going to have to become more European, and pool our (financial) risks still further. This will inevitably lead to more tax harmonisation within Europe. — Without being too audacious, we may predict that by 2017 we will have an overload of new regulations. It would be too tedious to list them all. Some will be beneficial, and others inadequate because the net will be cast too widely and catch everybody. We may also expect a modified and perhaps slightly more flexible version of Basel III to avoid the risk of completely killing off the banking industry and indirectly the «real economy». LE MAGAZINE DU TRESORIER / TREASURER MAGAZINE Where this has not already been done, we need to split investment banks from retail banks. As Belgium did in 1930. — juLy / Aug. / sept. 2013 Many people think that Greece will not put up with the rigour and austerity imposed upon it. Banks will be more cautious in granting credit, and they will keep on speculating even though the markets may be less volatile, at least within broad ranges. Volatility will still be there, but movement will be contained within narrow corridors. We could also face, with emerging or recently emerged countries, currency wars. François Masquelier, ATEL Chairman 3

Table des matières de la publication Trésorier/Treasurer magazine - n°82 - July/Aug./Sept. 2013

Couverture
EDITORIAL
SOMMAIRE
FINANCIAL HIGHLIGHTS
INTERVIEW - Mr Jacques Lafitte, AVISA
FOCUS
FORUM OF ADVERTISERS
CORPORATE FINANCE
15 MINUTES WITH - Robert Franck - Directeur associé VISCONTI
NEWS
The Financial Risk Observatory

Trésorier/Treasurer magazine - n°82 - July/Aug./Sept. 2013