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The system works exceptionally well, yet in the past year, we have seen increasing calls to change this model and use pensionfunds as a policy tool. The system works exceptionally well, yet in the past year, we have seen increasing calls to change this model and use pensionfunds as a policy tool.
While investors have typically included other hedge funds, family offices and sovereign wealth funds, the prospect of higher yields is now luring more money that’s been traditionally risk-averse. In Europe, insurers and pensionfunds are restrained by regulations on how much they can allocate to these higher risk strategies.
So a very different dynamic than we saw back in 2007, 2008, 2009. And so, that was a big event for us because all of those private equity relationships, as a limited partner, are fantastic drivers of knowledge and relationships and dealflow to finance those deals with those private equity firms. And I said three things.
And that could be painful, because someone will have to take the pain, even if, unlike 2008, where the risk was concentrated on banks’ balance sheet, today is much more spread across, let’s say, asset managers. And then you, obviously the real estate, many areas that were over-levered at the wrong cost.
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