“We’re quite happy to sacrifice some yield to keep the duration of our portfolios short and not to be exposed to the combo of illiquidity and interest rate sensitivity,” he says.
“And while we believe inflation pressures will subside in the short term as the one-off impact of Brexit starts to wane, we still think three to five-year inflation is the big thing to worry about, sustained inflation driven through wage growth.”
Globalised problems
But perhaps the biggest unresolved economic issue to Bathgate is the underlying cause of Brexit, president Trump, the fragmented political landscape in the west and redistribution of wealth.
“Blue-collar workers are worse off today than they were in the ’80s,” he says.
“The proportion of GDP that is accounted for by corporate profitability has never been higher but the problem is that these large companies don’t employ anything like the number of people that they used to.
“Added to that, they don’t pay anything like the level of tax they should. Look at the GM and Ford days compared with Tesla. Look at Google compared with some of the large companies 20 or 30 years ago.
“There has got to be some proper redistribution effect because, as things stand right now, the system is unsustainable.”
BIOGRAPHY
Haig Bathgate is joint chief executive and chief investment officer of Tcam, having spearheaded the management buyout of the firm from Turcan Connell in 2015 with fellow chief executive Alex Montgomery. At Tcam, he is responsible for the management and development of the proprietary investment strategy. He came to Turcan Connell as a graduate in 1997 before qualifying as an investment manager in 2000.
