An Interview with Larry Hatheway, UBS Chief Economist

by | December 10, 2019

In September 2011, the IMF estimated that roughly half of the Euro Zone’s $9 trillion in outstanding government debt was now at ‘heightened credit risk‘.   

This is a crisis which billionaire investor George Soros has described as, “…a more dangerous situation now than in 2008,” (which is further contextualized when you realize that Bank of England Governor, Mervyn King, described the 2008 crisis [on the record] as being, “…the most serious financial crisis we’ve seen at least since the 1930s, if not ever.”)

From small businesses to global banks and central bankers, there are few participants in the global financial market who are totally shielded from the Euro crisis.  Even at ground level you will find 10.4% of the population of the 17 countries that use the single currency were, as at January 2012 out of work (over 16.5 million people).

To learn more about the Euro Zone crisis and what it means for the global economy, we spoke to Larry Hatheway (Chief Economist and Chief Strategist at UBS, a bank with [as at December 2011] over USD 2.2 trillion of invested assets).  UBS are headquartered in Switzerland, and with over 65,000 employees globally are ranked as the second largest wealth manager in the world.

Q: Just how serious is the Euro Zone crisis?

[Larry Hatheway] This is a very serious issue that merits the very close attention of everyone involved be that Greece’s creditors, other official institutions, policy-makers throughout Europe and also market participants globally.  Why? Failure to find some sort of solution in a co-ordination fashion runs serious risks of leading to a very disruptive set of economic and financial outcomes…. potentially every bit as bad as the financial crisis of 2008.

Q: Do you think a break-up of the Euro is likely?

[Larry Hatheway] I still think it’s unlikely, but I would have to say that while it was a very remote possibility a year or two ago… it’s less remote now.  It still seems to be the risk-case rather than the central-case at the moment.  A break-up of the monetary union is so potentially fraught with risk that all participants, whether individual countries like Greece, or the remaining Euro Zone members, would do their best to avoid it… Continue Reading.

Originally published in All About Alpha

Filed Under: Economics

About the Author

Larry Hatheway has over 25 years experience as an economist and multi-asset investment professional. He is co-founder, with Alexander Friedman, of Jackson Hole Economics, LLC, which offers commentary and analysis on the global economy, policy & politics, and their broad implications for capital markets. Prior to co-founding Jackson Hole Economics, LLC Larry worked at GAM Investments from 2015-2019 as Group Chief Economist and Global Head of Investment Solutions, where he was responsible for a team of 50 investment professionals managing over $10bn in assets. While at GAM, Larry authored numerous articles on the world economy, policy-making and multi-asset investment strategy.

Larry was also the lead investment manager for various mandates, funds and an actively managed multi-asset index. Larry also served on the GAM Group Management Board, was Chairman of the GAM London Limited Board and served as member of the GAM Investment Management Limited Board. Larry was also Chairman of the GAM Diversity & Inclusion Committee. During his tenure at GAM, Larry was based in London, UK and Zurich, Switzerland.

From 1992 until 2015 Larry worked at UBS Investment Bank as UBS Chief Economist (2005-2015), Head of Global Asset Allocation (2001-2012), Global Head of Fixed Income and Currency Strategy (1998-2001), Chief Economist, Asia (1995-1998) and Senior International Economist (1992-1995). During his tenure at UBS, Larry was also a standing member of the UBS Wealth Management Investment Committee. While at UBS, Larry worked in Zurich, Switzerland, London, UK (various occasions), Singapore and Stamford, CT.

At both GAM Investments and UBS Investment Bank Larry was widely recognised for his appearances on Bloomberg TV, CNBC, the BBC, CNN and other media outlets. He frequently published articles and opinion pieces for Bloomberg, CNBC, Project Syndicate, and The Financial Times, among others.

Before joining UBS in 1992, Larry held roles at the Federal Reserve (Board of Governors), Citibank and Manufacturers Hanover Trust. Larry Hatheway holds a PhD in Economics from the University of Texas, an MA in International Studies from the Johns Hopkins University, and a BA in History and German from Whitman College. Larry is married with four grown children and a loving Cairn Terrier, and resides in Wilson, WY.

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