Mar 222017

Cliff Rossi

A perennial question for risk managers in any industry is how to better anticipate and react to potential risks before they can turn into something more serious over time. With markets, customer behavior and technology becoming increasingly dynamic and complex, the cognitive skills needed to adapt quickly to subtle but important changes are every bit as important as the analytic tools used to measure risk.

To better balance the “science” of risk management, greater attention much be made in cultivating the “art” of our profession — and this is where practicing situational risk awareness (SRA) can make a difference in your organization.  Read Professor of the Practice Cliff Rossi’s full column here

Mar 132017

Swagel-Phillip-HRWorking Paper: Privatize Fannie and Freddie, yes. But be pragmatic.

by Phillip Swagel, CFP Academic Thought Leader and Senior Policy Advisor, Susan Gates and Ann Schnare

It is a hopeful sign that Treasury Secretary Steven Mnuchin has raised privatization of Fannie Mae and Freddie Mac as an early order of business for the new administration.  The red ink that poured out of the two companies during the financial crisis has long stopped flowing, but Fannie and Freddie remain in the government-controlled limbo of conservatorship they entered in September 2008.  This leaves a situation in which government domination of the housing finance system puts taxpayers on the hook in the event of serious problems, even while many families find it difficult to obtain a mortgage.  With the two government-sponsored enterprises (GSEs) still the linchpins of the mortgage system, taxpayer money surely would be used to prop them up again in the event of a future housing downturn.  Hence, it is understandable that Mr. Mnuchin would like to privatize the entities as soon as possible, both to reduce taxpayer risk and to improve the effectiveness of the mortgage system at ensuring access to financing for families looking to buy homes.

Read the full paper


Feb 282017
Bill Longbrake

Bill Longbrake

Financial markets just about everywhere are doing well as global growth accelerates. But, while investors are enjoying rising prices, many are worrying about where the U.S. is headed politically under a divisive Trump Administration and about the potential for political crisis in Europe given the rise of populist and nationalist movements and the spate of national elections on tap for this year. In this month’s letter Bill Longbrake summarizes serious issues that are bubbling beneath the surface. He also examines the forces that led to the election of Donald Trump and muses whether Trump’s personality and illiberal tendencies might derail needed reforms to reverse the economic and social decline in America which has been gaining momentum in recent years.  Read the full letter.

Jan 172017
Bill Longbrake

Bill Longbrake

In this month’s letter, Bill Longbrake discusses the recent surge in business, consumer and investor optimism following the election of Donald Trump as the U.S.’s 45th president and assesses the 2017 outlook. He raises the question of whether the policies of the incoming Trump Administration and the Republican-controlled Congress, combined with political and economic developments elsewhere in the world, will lead to continued slow and steady growth in the U.S., or whether growth will accelerate, or perhaps recession might occur. All are possible outcomes in coming months. Based on past experience there is a good chance that bullish expectations will not be fully realized. In addition, some of Trump’s potential trade and tax reform policies could have significant and unpredictable adverse global consequences. Given the considerable uncertainty, prudence argues for being prepared to manage through any and all possible outcomes.

Read the letter.

Dec 212016
Bill Longbrake

Bill Longbrake

This month’s Longbrake letter consists of two parts. Part I is a final assessment of observations Bill made a year ago about how the U.S. and global economies might fare in 2016. As one might expect, Bill’s track record is mixed. The U.S. and global economies are dynamic and ever changing. Some trends are foreseeable. But, governmental policy intervention, whether it be political or economic, can alter outcomes and set in motion feedbacks that significantly affect economic developments. In this respect, 2016 was no different from any previous year. Part I also includes commentary about key U.S. and global economic and political developments that seem possible, perhaps likely, in 2017, along with a list of possible risks that could derail expected developments. Part II of December’s Longbrake letter explores a 10-year economic outlook for a variety of measures of economic activity and compares four of Bill’s scenarios with  projections of other professionals including the Congressional Budget Office.

Read both letters here.