Throw money at the problem?

At the Senate Autumn Investment Conference in Venice six months ago, the fund managers presenting faced the challenge of trying to make sense of the extreme and unprecedented events happening on an almost daily basis. Now they look back to assess what they got right and how things have changed

Much has happened since the Senate Investment conference in Venice at the end of September last year. Back then, Lehman and AIG had just collapsed and I tried, as best I could, to talk through the implications of frozen and dysfunctional credit markets, and the significant risk that the world economy would fall into depression if policymakers could not, or would not, come to their rescue. Ultimately, if quality borrowers in the household and corporate sectors were unable to access credit to make house or car purchases, or to raise working capital or project finance, then I argued economic a...