We begin to talk even with the Republicans

This is not the end of the world! Participating in our last Axel Weytens in what participants times, last Axel is participants à notre dernier Axel Weytens revenue dans les propos des participants fois, dernier Axel est des Plusieurs des several portfolios in HSBC Private Wealth Managers. Our guests, all four experts of the international actions, would have liked to go further than the horizon. But it is so clogged by the situation of the banks, including us! At the time, it was difficult to predict a catalyst to restart the course. As events go fast. Last month, the expert strategists feared deflation installation. This time, two managers predicted a resurgence of inflation! According to them, or injected billion by public administrations will prove sufficient and the consequences of the use of snowboarding tickets will result in a resumption of consumption, either Government plans fail and distrust towards government bonds will install. Tangible assets rush will cause an outbreak of the price of the latter. Almost a decade after the revolution of the Internet and the virtual, ironic in the reversal of the situation! A scenario which, in any case, calls for actions, including those gold mines. A perspective that was not to displease to our guests. Was Cédric Héreng, managing partner at metropolis management, Christophe Foliot, Deputy Director responsible for the management international shares in Edmond de Rothschild Asset Management, Vincent Strauss, Associate Manager Comgest, and Charles Firmin-Didot, managing funds shares international talent at AXA Investment Managers.

After the storm of the last quarter of 2008 and the beginning of the year a little more stable before again give way to the turmoil, how do you see the future of the markets on international

VINCENT STRAUSS. Having trained with the Jesuits, I answer your question with another question: what will be the response of the policy In all countries, the political power is structurally low. I think that everyone was surprised by the lack of decisions of the authorities in the United States. The indecision of Mr. Geithner and Mr. Paulson before him, was dramatic in the sense that, as stated a great Economist: "It had spun the keys to the cave to an alcoholic." Mr. Paulson has a heavy responsibility in the current crisis on the basis of these previous functions. Investors and taxpayers, especially in the United States could legitimately feel the existence of a monstrous Covenant of collusion, or even corruption, between political power and large banks. When you see the money ship in Citigroup, 45 billion dollars in capital and 300 billion removed dubious assets from the balance sheet in exchange for 7.8 of the capital, it is shocking. This Bank, like many others, was incompetent. The political power, especially in the United States, have the courage to say: "Gentlemen shareholders, you have funded incompetent who made the play." You lose. Your action is more worth nothing. "Currently, it unloads banks of questionable assets to paste them on the backs of taxpayers. In the interest of the latter, should return to the assets and liabilities. If it punishes neither the shareholders nor the leaders, it is the casino open. For the time being, political power still did not solutions, particularly in the United States, where it seems to me, the excesses were the largest. The issue is important, because in the end, when a banking system is bankrupt, it is still the taxpayer who pays.

For you all, the banks are at this point the critical problem

CHRISTOPHE FOLIOT. The key is to find a solution to save the banking system and stabilize the housing market. the problem of the banks is certainly crucial, but the sector represents more than 2 in the US indices. Banks experiencing catastrophic situations are well identified, including investment banks. However, retail banks, which have remained from the Investment Bank and which were not too granted mortgage loans, are less fragile balance sheets. For us, the banking sector is not a theme of investment, because we have little visibility and the risk of nationalization of the sector is more present. We begin to talk, even with the Republicans. However, there are interesting financial values, particularly from life insurance companies. Americans saving rate will increase in the future and this stream will not only benefit the banks, but perhaps also life insurance companies. However, it is necessary to keep

out of those who made too many "variable annuities", guaranteed capital, while the investment portfolio is largely exposed to the markets. Therefore, be very selective.

Let's not forget however that the banks are fundamental to the American market, where the credit market is highly developed (90 of cars are bought on credit).

CHARLES FIRMIN-DIDOT. For my part, I am quite agree with what said Vincent. Governments currently just to plug the holes, but undertake nothing fundamental to change this corruption. Soon, there will be such mistrust of the entire system that there is nothing to do. Term, must be calm enough significant corruption recently (call it the "collusion" instead). Unfortunately, the systems of remuneration of many market players were not punished. When you talk to entrepreneurs who have some experience in crisis, their conclusion is that deflation is temporary and that inflation will probably of very strong, even uncontrolled manner may be fairly quickly.

Where will it come

CHARLES FIRMIN-DIDOT. It will be either a natural recovery (which I do not really), or lack of confidence in the States. Once people will realize that Governments can make errors, they do their will be more. The Chinese, who meet internal security problems, could decide, rather than fund the U.S. Government, to invest in them and release the United States. Let's instead of Chinese. Since tens of years, they bought dollars, to maintain parity of close enough yuan to the dollar, to remain competitive, and dispose of the Western technology at home. Today, their delay is filled. They no longer have as much need of technology (in some areas they are same in advance). Previously, they were in need of American consumption. Now that it is no longer here, what good support the United States What good to buy dollars and U.S. Government bonds And if States could more funding, they would be forced to print paper currency and this can go very quickly.

VINCENT STRAUSS. We will not have inflation "outside", as in the 1970s, but that I would call "inside" and inflation which will result in a dramatic devaluation of the power to purchase and all papiers-monnaies.

CHARLES FIRMIN-DIDOT. Well seen with the assignat, but this is not yet the case today. The Government is still find money without problem. Investors came out of the actions, they are afraid and lend to Governments. However, must realize that they are not necessarily the work required, i.e. substantive work. In this scenario, the reaction of protection on the part of investors is to buy shares, property, gold associated with tangible assets and who will keep their value even if the paper money has less.

CDRIC HRENG. I return to the original issue on profile stock market developments. A consensus emerges that macroeconomic indicators have hit their lowest level in the fourth quarter and early in the first quarter, shows slight signs of rebound (Baltic Dry Freight index ISM index). It said that the worst may have passed and that the economy could start in the second half. For our part, we remain cautious. Because what we think that the situation will be difficult to digest, is that it is a consumption crisis. We are correcting the excesses of American consumption. However correct the excesses on 70 of the GDP is more painful to correct the excesses of overinvestment in business (as we have known him in the 2000's with the technology bubble). To talk about the financial sphere, I do not think to have a frank, massive, and the real economy, sustainable bounce without remediation of the financial sphere. Today, there is no visibility, but it is clear that the excesses of the financial sphere are not purged. Therefore, it will not rebound sustainable savings without this purge which passes through structures of cantonment and nationalization. Today, the financial sector is not able to get out of the crisis on its own. Therefore, it is necessary that political will helping to clean up the financial sphere. So, this is not the end of the world. The stock market is very poorly valued and this is perhaps one of the only classes of current assets that provides a very important potential for rehabilitation. To be frankly positive, there is today only a catalyst.