1、1SEPTEMBER 2022RETURNS REINVENTED2022 Global Investor ConferenceThe Pit&The Pendulum2Danger seemingly lurks in every direction The Fed has never successfully engineered a 400bps fall in inflation rates without triggering recession.Why would this time be any different?Europe finds itself in the midst

2、 of an energy crisis for which there is no parallel in the history of advanced economies.China faces an uncertain economic transition driven by demographic decline and high-tech ambitions U.S.policymakers view suspiciously.Many developing economies sit in their most precarious position in decades,bu

3、ffeted by shortages of food,fuel,and U.S.dollars.Investors are understandably anxious,with elevated implied and realized volatility across rates,credit,and equity markets A sense of foreboding might protect investors from some of these immediate risks but also degrade portfolio performance over time

4、.Todays challenges represent the aftershocks of pandemic-and-policy-inflected earthquakes.They will fade.Left in their wake will be memories of the fragility they revealed:inadequate and insecure energy supplies,over-engineered supply chains,and globalized production processes that prioritize effici

5、ency at the expense of resilience.Efforts to remediate these deficiencies could unlock trillions of dollars of capital deployment opportunities over the next several years,leading to higher investment rates and stronger growth than widely understood.3DISINFLATION&ITS DISCONTENTSSome argue the feared

6、 U.S.recession already arrived.Expenditure-based estimates of U.S.GDP contracted in both Q1-2022(-1.6%)and Q2(-0.6%).But if this was a recession,it was historys first to occur prior to any meaningful slowdown.Gross business receipts expanded at a 10%annualized rate in Q2-2022,more than twice the pre