Economic fundamentals need long-term policy
Global economies and employment levels will not improve until policy makers stop focusing on bad short-term policy fixes and implement credible long-term policies, according to the chief investment officer of Altrinsic Global Advisers, John Hock.
Speaking at the MLC Investment Summit in Melbourne, Hock slammed bad short-term fixes as being responsible for the worldwide economic malaise, criticising policy makers for seeing what they wanted to see instead of dealing with the facts.
Business would not start hiring again or spending capital until government policy makers stopped "moving the goalposts", Hock said.
People are disgusted with those who create economic policy and are ready for tough love, he said.
Good policy fixes are not pleasant, he added.
Hock criticised policy makers for being too focused on getting themselves re-elected, making the policy changes necessary to get on top of economic problems "unpalatable", which was causing problems for investors and workers.
"Policy makers are in a situation right now where the facts are presented for them, but rather than looking at the facts and addressing the facts, they tend to see what they would like to see," Hock said.
Equity performance is not necessarily related to economic performance, Hock warned.
The next ten years will be characterised by sub-par global domestic product growth, lowering living standards and rising crime rates, while the value of equities increase, he said.
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