Asset managers, please spare us your polyexcuses

Financial Times/Stuart Kirk/12-31-2022

“I have run money through many crises — from Japanese banking collapses, dot.com bursts, Asian contagions and the “end of capitalism” in 2008 to eurozone near-deaths, Donald Trump, Gulf wars and pandemics. They are always the worst ever. Helps sell newspapers or broker research, alright. And let’s be honest, we all want to feel significant — that we’re living through exceptionally important times. But please end these free passes for the managers of our money. No more polyexcuses.”

USAGOLD note: To reduce a complex problem with money managers who, these days, tend to run with the crowd, the advice is straightforward. Don’t be a lemming. The default excuse for the poor performances among portfolio managers in 2008 was “we didn’t see it coming” – a justification even a gracious Queen Elizabeth found lacking. “No one,” says Kirk, “avoids blame like a portfolio manager.” Even though they are paid large amounts of money to see around the corners (not to be lemmings), they excuse their shortcomings by declaring their interpretation the same as most other money managers. This opinion piece gets down to the nitty-gritty on what’s lacking in money management. Kirk is the former head of responsible investment at HSBC Asset Management and a previous editor of FT’s Lex column.