Guest article written for AllAboutAlpha.com – the official publication of the  Chartered Alternative Investment Analyst (CAIA) Association

Originally posted at: http://allaboutalpha.com/blog/2012/08/15/the-greek-opportunity/

“Of all the economic horror stories produced since the banking crisis…” wrote the Guardian in July 2011, “Greece must be the most frightening. It has easily the worst economy out of all the 16 nations in the eurozone…” Such rhetoric about the Greek economy has been commonplace in the last couple of years with journalists and commentators treating the nation (at least in words) as a pseudo-failed state.

Before we begin, let’s be absolutely clear. Greece does have an economic crisis.  This is a country which has experienced years of recession, a 20% decline in GDP, huge unemployment and a fair amount of civil unrest (in the form of regular, and sometimes violent, protests).  A storm of factors brought Greece to this point.  Firstly the spread of the financial crisis to Europe, secondly a political system (filled with corruption, bribery, populism) which was unwilling to reform, and thirdly- some poor fiscal planning.  Greece’s key sectors (including tourism and shipping) were also unusually (and perhaps uniquely) vulnerable left-tail economic events.

Let’s also be clear that these are not just Greek problems, the entire Euro Zone sits weakened as the result of a crisis which exacerbated fractures which were already there.  Countries like Greece, Portugal, Italy, Spain and Ireland were the most vulnerable within this group- and thanks to the political disconnect of the ‘union‘… were the first to come unstuck.

In sharp contrast to genuine failed (or failing) states such as Afghanistan, Iraq and Nigeria (and also states experiencing extreme volatility such as Kenya, Pakistan and Egypt), Greece sits as nation which, while experiencing a crisis of credibility, has a number of very positive opportunities for recovery, development and wealth creation.  So what is the case to invest in Greece?

To learn more, I spoke to Nicholas Economides – Professor of Economics at the NYU Stern School of Business. Continue reading →

Guest article written for AllAboutAlpha.com – the official publication of the  Chartered Alternative Investment Analyst (CAIA) Association

Originally posted at: http://allaboutalpha.com/blog/2012/06/18/alpha-hunters-investing-in-urban-communities/

In 1800 only 2% of the world population (which was just 970 million in total) was urbanised.  By 1950 that figure had grown to 30%, and by 2030 it is estimated that more than 60% of the world’s population (around 5 billion people) will live in towns and cities.  Already over 193,000 people are being added to the urban population every day, more than 2 each second.

While much attention is given to the urbanisation of the developing world, similar trends have been occurring in the developed countries which have profound economic and social effects. The 2010 US Census showed that America’s urban population increased 12.1% from 2000-2010 (against a national population growth rate of around 9.7%).  Almost 80% of the US population now live in urban areas.

In the developed and developing world, urban communities are synonymous with contrast, they contain some of the densest pockets of wealth and poverty together with huge diversities in ethnic groups, languages, cultures, economies and more.  They are seething masses of humanity with a mix of social issues and opportunities, and we are only just beginning to understand them.

To learn more about urban communities and the investment case they present, I spoke to K. Robert “Bobby” Turner (Chairman, CEO and Co-Founding Partner of Canyon Capital Realty Advisors and a Partner in Canyon Partners) who has overseen more than $12 billion of investment into urban communities.  Continue reading →