|By Fran Lysiak|
|A.M. Best Company, Inc.|
The European debt crisis and its impact on the U.S. and global economies are a top concern of investors this year, according to a panel of market experts from
When it comes to stock markets, "uncertainty is the enemy," said
But things aren't too bleak. Heading into the new year, across the board, some data for the U.S. economy is stronger in terms of employment and vehicle sales, which are important as far as gross domestic product is concerned, she said. Even housing is showing more demand in certain pockets of the country, Krosby said.
As the year moves on, the dynamic will change, and concern will mount about how much the downturn in
If companies are worried about a slowdown globally, they're not going to spend on equipment and will hold back on hiring, Krosby said.
Investors are struggling between the relatively low yields with fixed income offset by the fact that they're concerned about the volatility in the stock markets and the European crisis, said
He says the biggest concern for all investors, including life insurers, is
The issues facing
The question becomes, will European leaders handle it as economics, Krosby said. That is, if
That's the biggest story, and ultimately may become one of "politics trumps economics," Krosby said, noting the idea behind the EU, prompted by
Now they will be making a decision that despite the cost associated with keeping
The question is whether there's another round of quantitative easing by the central bank, which Krosby dubbed as another way of saying "the printing of money."
In this environment, the life industry is mostly buying investment-grade corporate bonds with high credit quality that provide good spreads, and isn't making big buys into Treasuries, Lillard said.
To see an interview with Krosby, go to http://bcove.me/qg5k2p8l
|Copyright:||(c) 2012 A.M. Best Company, Inc.|