Portfolio Manager Perspectives

Jeff Benjamin

ING's Uri Landesman: predicts unemployment will peak by February

Nov 12, 2009 @ 10:54 am

By Jeff Benjamin

Investors should be careful not to let the “sticker shock” of the latest unemployment data derail them from their long-term investment strategies, said Uri Landesman, head of global growth at ING Investment Management Americas.

“I would not be changing a longer-term asset allocation strategy based on anything we've seen in the last two years,” said Mr. Landesman, who manages $1.7 billion worth of pension account assets.

While acknowledging that the latest data showing a 10.2% national unemployment rate was above his 9.9% forecasted rate for 2010, he believes unemployment is nearing a peak.

“My gut is telling me the peak in unemployment is coming soon, and I'd get nervous if it didn't peak by February,” he added.

What happens from there, however, will depend largely on whether the banks start lending money again, he said.

“The banks are afraid that the economy right now is primarily being driven by government stimulus,” he said. “And it is a dangerous call, because we won't know until the government stops liquidating the financial markets if the economy can grow on its own.”

Based on the bullish manner with which the stock market has responded over the past few days to last week's report showing the highest unemployment rate in 23 years, Mr. Landesman said there is a case for being “reasonably sanguine” about the stock market.

“I could see the stock market rallying another 5% this year,” he said.

However, he explained, such a move will require continued support from the business sector and a step-up in support from consumers.

According to an ING proprietary model that measures 14 economic indicators, the seven indicators related to business activity are all positive, while the seven indicators related to the consumer remain negative.

“It's pretty clear that businesses are leading the recovery,” he said. “Consumers are not likely to get on board until they start to see unemployment going down.”


What do you think?

View comments

Most watched


How the 2020 elections could impact ESG investing

Joseph Keefe, president of Impax Asset Management, on the elections and how advisers can build a bridge to the next generation of clients with ESG investing.


How advisers can be a gamechanger for women investors

Why women defer to men when it comes to finances and how advisers can combat this phenomenon and make a difference for female investors, according to Heather Ettinger, founder and CEO Luma Wealth Advisors.

Latest news & opinion

Charles Schwab reportedly in talks to buy USAA brokerage, wealth management business

The deal would net Schwab roughly $100 billion in new assets.

Advisers scramble to help retirees navigate looming Fed rate cut

The Fed's first interest-rate cut in a decade has advisers warning against chasing the bait of risk over safety.

CFP Board to announce possible delay of new fiduciary standard

Organization's CEO confirms meeting with Edward Jones, says broker-dealer still considering how to move forward.

Departure of Alexander Acosta could slow DOL effort to revise fiduciary rule

Acting secretary Patrick Pizzella will have to make political decision to move ahead.

SEC member Peirce to brokers: Talk to us early, often about Reg BI implementation problems

She's willing to advocate for additional compliance time if firms have made a good faith effort.


Hi! Glad you're here and we hope you like all the great work we do here at InvestmentNews. But what we do is expensive and is funded in part by our sponsors. So won't you show our sponsors a little love by whitelisting investmentnews.com? It'll help us continue to serve you.

Yes, show me how to whitelist investmentnews.com

Ad blocker detected. Please whitelist us or give premium a try.


Subscribe and Save 60%

Premium Access
Print + Digital

Learn more
Subscribe to Print