The 2008 financial crash shook the confidence of much of the developed world particularly the investor elite whose portfolios were exposed to the downturn. Since then, confidence has gradually been restored as a majority of investors in a recent poll reported they felt the comeback from the collapse was complete and that their financial position returned to normal. However, nearly 90 percent of respondents also stated that they now intend to hold larger cash stakes in order to protect themselves in the event of a liquidity crisis. This is in spite of the fact that the money will feel the effects of inflation and not be allowed to grow through investment. While this might be a sign of skittish caution, the recent economics woes of the BRIC’s, Europe, and the Middle East may indicate that those with exposure to market downturns are preparing for the worst. But for the sake of the world’s economy, let us hope that their caution proves to be unnecessary.
See, Emotional Scars, Wealth Management, February 5, 2016.
Special thanks to Jim Hillhouse for bringing this article to my attention.
