Business owners retreating from risk while waiting for recovery by ProQuest


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									sPOtLiGHt: BankinG & FinanCE

Business owners retreating from risk while waiting for recovery
            By Martin C. Daks                    get deficit and the specter of inflation are driv-        when people get burned, as many did                              into money market funds.”
BUsIness owneRs who have seen their              ing many business owners to wonder where             during the last year or two, they tend to shy                               Despite that, he still sees an opportunity
personal finances battered by the roller-        they should be investing their free cash.            away from risk, said Darin P. Pope, chief invest-                     in equities.
coaster economy may be feeling a little less          The best bets appear to be a move —             ment officer at United Advisors, in secaucus.                               “Right now, U.s. equities are undervalued,
shaky, now that some signs are pointing to a     though not a flight — toward safety, experts              “A couple of years ago, many business                            because of the near-collapse of the finance
modest recovery.                                 said. many are counseling investors to reduce        owners were putting their money in equities,”                         system,” he said. “The european debt and euro
     But it may be too soon to put away the air- their equity exposure and instead look to            he said. “But now their risk tolerance has                            crisis is scaring many people away from inter-
                                                 municipal or corporate bonds
sickness bags, say some wealth management 3/29/10 11:56 AM Page 1 that may not be
 BED6905 Car Ad NJBiz.doc:Layout 1                                                                    decreased, and many are moving into bonds                             national stocks, but you have to remember
experts. higher taxes, a swelling national bud-  as volatile.                                         — although I see very risk-averse clients going                       that the U.s. crisis was driven largely by bank
                                                                                                                                                                            troubles — not by the underlying domestic
                                                                                                                                                                            economic system. many people tend to invest
                                                                                                                                                                            through a rear-view mirror, and they can easily
                                                                                                                                                                            forget how quickly the U.s. economy can stage
                                                                                                                                                                            a recovery.”
                                                                                                                                                                                  Then again, not everyone’s shying away
                                                                                                                                                                            from international investments.
                                                                                                                                                                                  “Depending on individual clients’ overall
                                                                                                                                                                            objectives, we’re looking to overweight invest-
                                                                                                                                                                            ments in Asia, exclusive of Japan,” said Ann D.
                                                                                                                                                                            Borowiec, managing director of J.P. Morgan’s
                                                                                                                                                                            Private Bank division. “we’re also shorting
                                                                                                                                                                            the euro.”
                                                                                                                                                                                  For business owners, Borowiec recom-
                                                                                                                                                                            mends a “barbell” approach, with conservative

                                                                                                                                                                                        ann D. Borowiec
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