Wednesday, September 17, 2014
Inquirer Daily News

Greece is the word and the worry

Cumberland Advisers' David Kotok see the euro zone emerging stronger as authorities get sovereign debt challenges under control.

Greece is the word and the worry

To those who are indignant that the European Union hasn’t crafted a solution for Greece’s debt crisis, money manager David R. Kotok has a retort.

“Why do we expect the EU to have perfect answers when you look at our history over the last three years?” said Kotok, chief investment officer of Cumberland Advisors in Vineland.

With that, he listed the $700 billion Troubled Asset Relief Program, the different regulatory responses to the collapses of Lehman Bros. and American International Group, the rescues of Fannie Mae and Freddie Mac, and even the bungled oversight of Ponzi schemer Bernie Madoff.

The fact is, many Americans don’t care if Greece were to default. But Kotok said they should, because the Mediterranean country’s 12.7 percent budget-deficit-to-GDP ratio is close to the United States’ 9.9 percent shortfall.

And Greece is but one of five euro-zone countries groaning under its debt. (Ireland, Italy, Portugal and Spain are the others.)

“They all face slow growth and economic difficulties,” he said. “In the U.S., we do too.”

While some commentators see the Greek sovereign debt crisis as potentially dooming the euro, Cumberland Advisors has been telling clients that it is betting on the world’s most important currency besides the U.S. dollar.

“I actually think the euro zone will emerge stronger and the ECB [European Central Bank] will come out stronger,” Kotok said.

Snowed Under

Now the car-nage of the Feb. 6 snowstorm can be told.

The Philadelphia International Auto Show attracted 23,000 people in its closing weekend, rather than the 85,000 that were expected.

That includes just 3,900 hardy souls on Saturday, said Kevin Mazzucola, executive director of the Auto Dealers Association of Greater Philadelphia. “Frankly, I’m surprised we had that many,” he said.

Attendance for the nine-day event totaled 150,000, lower than the 215,000 to 220,000 that had been expected. The 2009 edition had drawn 205,000 at a time of great uncertainty for the U.S. automobile industry. “Normal” years attract 230,000 to 240,000 pilgrims.

Still, Mazzucola said he’ll focus on attendance trends before the snow came and kept car lovers home - up about 6 percent through Feb. 4. “I’m proud of the numbers we got,” he said.

Mike Armstrong Inquirer Columnist
About this blog
Mike Armstrong blogs about Philadelphia corporations and business-related topics. Contact him at 215-854-2980. Reach Mike at marmstrong@phillynews.com.

Mike Armstrong Inquirer Columnist
Business Videos:
Also on Philly.com:
Stay Connected