Top officials from the Robert W. Baird & Co. financial services firm were in Charlotte last week with some insight on big banks, the broader economy and how investors can stay afloat in a challenging market.
Chief executive Paul Purcell, who has expanded the Milwaukee wealth management, capital markets, asset management and private equity firm to more than 100 offices worldwide, said Charlotte is an important hub. Baird's SouthPark office, which opened three years ago, has already benefited from top-notch financial services talent and a strong cultural fit, he said.
Purcell said he feels good about the local economy - activity in the Carolinas is heating up, and the region remains a good place to live - and its major players. Despite Bank of America's ongoing mortgage woes, for instance, the Charlotte bank is "phenomenal" and will ultimately be OK, he said.
Still, Purcell and chief investment strategist Bruce Bittles acknowledged the broader economic picture remains murky, with anemic growth and a continued push among consumers and companies to shed debt.
Bittles said the economic difficulties will stretch at least into next year, partly because of the uncertainty surrounding the presidential election. He doesn't expect another recession, but "it's still going to be dicey," he said.
For the economy to improve, Bittles thinks a few things need to happen, policy-wise, including simplifying the tax code, capping government spending and creating a strong energy policy.
Meanwhile, he offers a few tips for investors:
- Maintain a strong asset-allocation strategy. Bittles recommends the average investor put 50 percent in stock and 35 percent in high-quality government bonds, with the rest in cash and gold.
- Focus on three areas, at least for now: energy, utilities and consumer staples.
- Beware of the banks: Financial stocks will continue to struggle because they remain "under the political nightstick" and don't yet have a strong handle on their liabilities. Bittles thinks better government policies, though, will lift all boats - maybe banks specifically, he said.