William M. Priest

Given the severe correction, this veteran manager believes markets are fairly valued.

Michael Ryval 7 November, 2008 | 2:00PM
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In a career spanning 42 years, William Priest reckons this bear market is one of the most difficult he has experienced. "This decline, so far, has been the second worst since the 1930s," says Priest, CEO and chief investment officer at New York-based Epoch Investment Partners Inc.

Priest, whose firm oversees about US$2 billion in assets for Toronto-based CI Investments Inc., maintains that markets are affected by three inter-related crises revolving around liquidity, solvency and the real economy.

The liquidity crisis, he believes, has subsided as the so-called TED spread (which measures the relationship between yields on U.S. treasuries and Euro-dollars) has fallen to 220 basis points (bps), after peaking at 400 bps. "It's come down a lot as central banks and the powers that be address the problem. The liquidity crisis can, and will, go away."

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About Author

Michael Ryval

Michael Ryval  Michael Ryval, a regular contributor to Morningstar, is a Toronto-based freelance writer who specializes in business and investing.

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