Global Shocks

© SpringerAn Investment Guide for Turbulent Markets
Nicholas P. Sargen
November 2016
£19.99 | $29.99 | Hardcover | 978-3-319-41104-0

‘When the markets are going crazy and the financial world seems to be falling apart, Nick Sargen is one of the first people I call to figure out what it means from a historical, economic, and financial perspective. Global Shocks has it all, including how to survive and thrive in the next inevitable financial crisis.'
—Consuelo Mack, Anchor and Executive Producer, Consuelo Mack WealthTrack.

Most investors are well versed in the tenets of modern portfolio theory, but they lack a framework for dealing with stock, bond, and currency markets during periods of instability. Younger investors are even more disadvantaged because they only know the post-crisis environment in which interest rates have been set at zero.

Nicholas P. Sargen has four decades of experience as an international economist and market strategist covering global markets for Morgan Guaranty Trust, Salomon Brothers Inc., Prudential Insurance, J.P. Morgan Private Bank and most recently as Chief Economist for Fort Washington Investment Advisors Inc., an affiliate for the Western & Southern Financial Group. In his new book, Global Shocks: An Investment Guide for Turbulent Markets (Palgrave Macmillan, 18 Nov. 2016), Sargen fills the void by providing the reader with a toolkit and guiding principles to manage money when markets are in turmoil.

Written from a practitioner’s perspective, Sargen argues that investors who understand the common elements in crises have a better chance not only of surviving them but, ultimately of benefiting from them. Global Shocks details how a series of currency crisis that were prevalent in the 1970s and 1980s followed a predictable pattern in terms of movements in interest rates and exchange rates. However, this is not the case for asset bubbles that ensued.

Therefore, Global Shocks is organized into two sections: Investment Challenges in a High Inflation Era and Easy Credit Breeds Asset Bubbles and Instability. Both sections are illustrated through a number of case studies (ten in all), beginning with the breakdown of the Bretton Woods fixed exchange rate system through the current situation in which investors are assessing whether China could become the next bubble.

Each chapter discusses how the respective crisis or bubble unfolded at the time, the way policymakers and markets responded, and the optimal strategy for positioning portfolios.

Sargen’s goal is to share these experiences and the lessons from them, so investors will be better prepared to recognize patterns and warning signs for future shocks.

Global Shocks’ concluding chapter ties the episodes together and considers how the nature of financial crises has evolved since the collapse of Bretton Woods.

“We cite factors that make it difficult for policymakers and investors to detect problems in advance of an asset bubble. The good news is investors get a second chance to outperform when markets are over-sold; however, they need to formulate a strategy to limit the damage during the sell-off phase and to capitalize on the eventual recovery,” argues Sargen.


About the Author
Nicholas P. Sargen is an international economist turned global money manager. He has been involved in international financial markets since the early 1970s, when he began his career at the U.S. Treasury and the Federal Reserve. He subsequently worked on Wall Street for 25 years, holding senior positions with Morgan Guaranty Trust, Salomon Brothers Inc., Prudential Insurance and J.P. Morgan Private Bank. In 2003 he became Chief Investment Officer for the Western & Southern Financial Group and its affiliate, Fort Washington Investment Advisors Inc, where he now serves as Chief Economist.

Sargen has written extensively on international financial markets, and he currently produces a blog, Focus: Separating News from Noise, on his website, where his views are updated. He appeared frequently on business television programs throughout his career on Wall Street, and was a regular panelist on Louis Rukeyser’s Wall Street Week. He was born and raised in the San Francisco Bay Area, and received a PhD in Economics from Stanford University. He is also an adjunct professor at the University of Virginia’s Darden School of Business.

For more information or to get in touch with the author please contact:
Rebecca Krahenbuhl – Communications Manager, Palgrave Macmillan
rebecca.krahenbuhl@palgrave.com, +44 020 7014 6634