Growth

Europe's recovery faces dilemma

Europe could address its long-term debt problems by hiking retirement ages, according to Baring Asset Management, but lacks the ability to make the right choices.

Greece’s fiscal profligacy has increased uncertainty in financial markets worldwide and the eurozone sovereign debt crisis has only heightened concerns for investors. Commentators and economists are busy airing their views on what has caused the situation to escalate so quickly and how it can be resolved. Last week it was the turn of Baring Asset Management.

“The problem has been leverage,” said Marino Valensise, chief investment officer at Baring Asset Management. The reason for this, he explained, is that the extra leverage needed to generate an additional $1 million in profit has increased from $1.37 million in the 1950s to $5 million in 2007, due to fewer arbitrage opportunities. In...

¬ Haymarket Media Limited. All rights reserved.

FinanceAsia has updated its subscription model.

Registered readers now have the opportunity to read 5 articles from our award-winning website for free.

To obtain unlimited access to our award-winning exclusive news and analysis, we offer subscription packages, including single user, team (2-10 users), or office-wide licences.

To help you and your colleagues access our proprietary content, please contact us at subscriptions@financeasia.com, or +(852) 2122 5222

Article limit is reached.

Hello! You have used up all of your free articles on FinanceAsia.

To obtain unlimited access to our award-winning exclusive news and analysis, we offer subscription packages, including single user, team (2-10 users), or office-wide licences. To help you and your colleagues access our proprietary content, please contact us at subscriptions@financeasia.com, or +(852) 2122 5222