The FINANCIAL -- HSBC is a global bank, with one of the widest global coverage of any bank. It is also known to have some of the finest core competencies which give it a highly reputed brand; its Premier Client service which allows its select customers to do business internationally with greater ease has won the bank much plaudits.

In addition, the bank has cruised through the troubled waters of global financial crisis without breaking its wings. Given its global eminence, it is worthwhile listening to Nigel Webber, Chief Investment Officer, HSBC Private Bank, on what the first quarter of 2012 holds for developed and emerging markets. Simply put, it is “ Walking on a tightrope”.

Scanning asset class of Equities, Fixed Income, Currencies, Commodities, Hedge Funds, Real Estate, Private Equity and Risks across the United States, Eurozone, the United Kingdom, Japan, China, Developed Pacific ex Japan, Emerging Asia ex China, Latin America, Central and Eastern Europe, Webber’s note to the world at large is sobering: “ I regret to tell you that the year 2012 starts with a dismal outlook for the world economy. Slower growth or even recession for numerous economies is on the cards for at least the first half of this year and there are few reliable signs of recovery on the horizon beyond the first half”.

He adds, in his preface to the Bank’s Investment Outlook analysis, “ compounding the economic slowdown, political events are working to make the slowdown worse than it would otherwise  have been, particularly in Europe and the USA – the two largest economic blocks in the world. For different reasons in each region, the political process seems unable to support a recovery in economic growth which is essential for the general well being of a country and prosperity of its citizens. In Europe, the added problems of the Eurozone have the potential to cause real economic distress if not resolved in the near future”. He tails off his warning note with a comment that the only opportunity for investors is to buy quality distressed assets at more attractive prices.

I read Webber’s note just two days after I chanced to view the Academy Award winning documentary “The Inside Job” which exposes years of negligence and financial indiscipline, lack of transparency and governance and in many instances highly fraudulent practices embedded in the global financial system which has caused the current turmoil, leaving millions of people jobless and in bankruptcy, with partial or total recovery many years away. Many analysts believe that even if the eurozone catharsis goes away in the near future, it would take a minimum of five to seven years for the global economy to stabilise and regain confidence. It is indeed a very sad and tragic situation where, I would suspect, the current financial and economic chaos may lead to more violent upheavals and perhaps to cross border wars against nations.

London’s Financial Times has been publishing some important articles on the collapse of capitalism, once enshrined by mainly Western economists as the panacea to freedom and economic equality. We all know that it has not worked for the West or the East, but only for the top 5 percent of the world’s population. What is refreshing is that there is now a certain boldness in openly discussing and questioning some of the fundamental issues that affect human lives, everywhere. Discussing the collapse of capitalism may not attract prison sentences anymore, mainly because what we have now is a collapse of capitalism and communism, thankfully at the same time.

I have often talked openly about the distress human greed causes, as expressed in unbridled competition for resources and amassing of surplus profits. My friends often told me I am left of the centre, and I would respond asking them “ where is the centre?”. As Davos Economic Forum once again gathers its disciples and dissidents next week in Switzerland, the same old debates on economic balancing acts and growth will certainly surface and much of the discussions and polemics will create large bundles of debatable documents, only to be re-written and presented once again, with some modifications at the next Davos colloquium. What are we in fact achieving to get a firm grip on the problems at hand is the question. Is there a bankable possibility of a serious commitment to undo the malady that has been deliberately and purposefully created in the financial system.

This morning in Singapore, I took a taxi from my hotel to the financial district for a meeting with two bankers. On the way, the 65 year old taxi driver took a phone call and apologised it was urgent, although forbidden under the traffic laws. He said an Indian lady had accidentally dropped a one 1000 Singapore dollar note in his taxi and she was calling him, via his taxi company to find out whether he found the note. I hear him tell her on the phone “ Mam, your cash is with me and I have informed the taxi company it is with me... you just pay the taxi fare and I shall drive by and hand it over to you”. He made no fuss. It was as if it is just the normal way of life here in Singapore. I talked to him briefly and said it is highly commendable, that he did not take that for himself. He looked back, with the wisdom of Tao, and said “ it is not my money and so it does not belong to me”.

At the meeting with the bankers later, we discussed the Singapore and regional economies, investment climates and corporate strategies. We also talked about why the financial meltdown occurred and what the future holds. Throughout the discussions, the taxi driver and what he said kept ringing in my head “ it is not my money and so it does not belong to me”. Singapore’s chief architect and nation builder Lee Kwan Yew fought corruption tooth and nail and gave Singapore a defined image of high level of efficiency and decorum. People like the Singapore taxi driver who drove me today, a generation disciplined by Lee’s foresight and control,  make me wonder why we cannot evolve a system that denies access to greed of investment bankers and funds managers and still make reasonable profits which is essential to keep the wheels of innovation, modernity and global ventures look attractive to investors.

From China to Australia, From Brazil to Indonesia, From Greece to Greenland, the coming-out of the financial meltdown and facing off a recession is the hot topic of discussion. There is genuine fear that the global economy may indeed take a bigger hit than what is predicted and that recovery may take a longer time. In Melbourne last week, I met a number of people asking me questions of how Europe will withstand it own problems. I referred them to an article in the Australian Financial Review which referred to the “ Merkozy” strategy of Germany’s Merkel and  France’s Sarkozy, which seemed to suggest that the hopes of all nations rested on just two people, and their europolitik. As Webber of HSBC has said:  we may be walking on a tightrope.

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