Deutsche Bank’s Bearish EM Specialist John-Paul Smith Founds Firm

Deutsche Bank AG’s Emerging Markets and BRIC strategist John-Paul Smith has reportedly left the group to found his own independent research firm, tapped Eclectic Strategy, bringing in former colleague Emad Mostaque.

Mr. Smith has developed an infamous reputation for his bearish views on Emerging Markets (EM), which has historically run counter to many others on Wall Street and the financial industry.

Indeed, according to Mr. Smith in a recent statement last week regarding the prospects of EMs, “Most emerging markets are now trading ahead of the underlying fundamentals. The latest rally is another false dawn before increasing concern about the underlying condition of the Chinese economy causes Liquidity Liquidity The term liquidity refers to the process, speed, and ease of which a given asset or security can be converted into cash. Notably, liquidity surmises a retention in market price, with the most liquid assets representing cash.The most liquid asset of all is cash itself.· In economics, liquidity is defined by how efficiently and quickly an asset can be converted into usable cash without materially affecting its market price. · Nothing is more liquid than cash, while other assets represent The term liquidity refers to the process, speed, and ease of which a given asset or security can be converted into cash. Notably, liquidity surmises a retention in market price, with the most liquid assets representing cash.The most liquid asset of all is cash itself.· In economics, liquidity is defined by how efficiently and quickly an asset can be converted into usable cash without materially affecting its market price. · Nothing is more liquid than cash, while other assets represent Read this Term to be withdrawn from the asset class.”

Mr. Smith joined Deutsche Bank in 2010, having worked at Pictet Asset Management for a number of years in senior management. Prior to Pictet, he also served as a leading forecaster at Morgan Stanley. In his new role, he foresees Eclectic offering comprehensive analysis on emerging and frontier markets to an assortment of institutional and individual investors.

“The name ‘Eclectic’ implies that we will harness a variety of inputs and are not driven exclusively by macro-economic or stock specific factors. The best insight in future macro-economic trends comes from studying developments in the corporate sector, especially the relationship with the state,” added Smith in an accompanying statement on the focus of his new firm.