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In the first quarter issue of Global Foresight, Rockefeller presents an in-depth review of the risks and opportunities facing global investors in 2013. David Harris, Chief Investment Officer, discusses how the slow mend in the global economy, low interest rates, and other factors should keep equities as a logical core of most portfolios. Jimmy Chang, Senior Portfolio Manager, explores investor unease with the current global economic environment, but notes that staying anticipatory and opportunistic will be important for long-term investors.

As shown by local bans in the US and Canada, national moratoriums in France and Bulgaria, and tighter regulation in Australia and the UK, the global anti-fracking movement has mounted an effective campaign against the extraction of unconventional gas through hydraulic fracturing (‘fracking’).

The phrase is often heard that financial markets do not like uncertainty. The uncertainty surrounding the November elections in the U.S. is behind us. However, much uncertainty remains. The main sources of that uncertainty include the fiscal cliff, the need to increase the federal debt ceiling, the absolute level of the federal debt, and the regulatory environment. This paper looks at the options available to the Obama Administration and congress how these issues could play out in the near term.

For well over a year now, investors have dreaded the US’s looming “fiscal cliff”—the combination of federal budget cuts and tax increases scheduled to take effect on January 1, 2013. Should America’s gridlocked Congress not agree on a work around, some economists, credit ratings agencies and government forecasters believe the US economy could slow significantly or even enter recession. This paper looks at the likelihood the United States falls off the fiscal cliff.

President Obama will head into his second term in January facing a divided Congress that looks a lot like the Congress of the last two years of his first term – with the Democrats controlling the Senate and conservative Republicans solidly controlling the House of Representatives.

While political pundits work overtime to draw profound conclusions from Tuesday’s election results, the implications for the financial markets seem less than momentous. Election night was clearly much better for Democrats than Republicans, but this was a status quo outcome. Until the 2014 mid-term elections, the players will be President Obama, a GOP House of Representatives and a Democratic Senate—the same mix as the last two years. This begs the question, “Will anything be different?”

The world’s largest developed economies continue to experience modest and volatile growth as they work off excess debt accumulated over the previous decades. Global growth is unlikely to come in a straight line, due to the instability caused by excess debt and the inconsistency and cyclicality of governmental policy response. In fact, in the near-term, global economic growth appears to again be waning, creating the third annual growth scare since 2009. This has prompted further monetary action from central banks. Will it be effective?

Current U.S. fiscal policy, if not modified before year-end, is on track to deliver a $600 billion economic headwind in 2013 (the equivalent of 4 percent of U.S. GDP), while the 2012 presidential and congressional elections add another layer of uncertainty to an already complex and politically challenged situation.

The upcoming election is as much about how we address fiscal issues as it is about the pace of the remedy; at the center is the debate over taxes and the size of government.

The fourth quarter 2012 issue of Global Foresight features a discussion of the recent QE3 (quantitative easing) announcement by Federal Reserve Chairman Ben Bernanke and the related inflation and market implications, along with a discussion of the current geopolitical overlay.