Economic storm continuing, say hedge fund managers

The global economic outlook is gloomy and will stay that way for another two to three years, according to hedge fund manager Lee Robinson.

Robinson, a director at London-based Trafalgar Asset Managers which produced positive returns in 2008, said policymakers were repeating historical errors in the decision-making aimed at resolving the financial crisis.

Robinson said stability would be key and investors should try and avoid "catastrophic errors" for the foreseeable future. He was speaking at the launch of The Gathering Storm, a book written by a group of hedge fund managers and economists.

"We're not being gloomy. We're just saying that something has to give and people have to be very careful about where they invest their money," Robinson commented.

Each chapter is written by a different manager or economic specialist. Overall the authors were generally bullish on gold but had mixed views on equities, emerging markets and other asset classes.

Despite the scale of the 2008 crisis, Robins said he was "never more scared than in May this year". "We have sat on the precipice a couple of times in the last few months," he admitted.

Authors contributing chapters to the book included Oaktree Capital Management chairman Howard Marks; Avenue Capital chair, CEO and co-founder Marc Lasry; Arcus Investment founder Peter Tasker; and Société Générale global strategists Albert Edwards and Dylan Grice.

All those involved with the book's production, including the authors, waived their fees and royalties and are donating all proceeds to a variety of charities chosen by the authors. Robinson said one of the reasons for the project was to help charitable causes.

The Gathering Storm: How to avoid the next crisis - from the minds that predicted the crunch, an Altana Charitable Trust project, is published by Derivatives Vision Publishing, 2010.