2009 Due Diligence Forum

Positioning portfolios in a deleveraging world


Taking Stock - Equities - Global Diversified


Magellan Asset Management

Research Paper

After an extraordinary 15 year period of economic expansion in the developed world - primarily driven by the continued willingness of households to consume more than they earn - the level of household debt relative to income has reached levels where its continued growth is highly unlikely. With household consumption accounting for approximately 70% of GDP in most developed countries, deleveraging presents a significant challenge to the level of economic growth in these economies over the next 15 years. This paper seeks to discuss this challenge and how to position portfolios in light of it.


Hamish Douglass, Managing Director & CEO, Magellan Financial Group