Managers seek safe havens as chaos returns to markets

Chaos in markets across the globe this week following heavy sell-offs prompted some commentators to warn of a new credit crunch, and left investors desperately seeking safe assets.

Fund managers have adopted a range of tactics in a flight to safety, with some looking to gilts, cash, and gold and others holding their nerve to buy equities on weakness. MAM Funds’ Martin Gray said the falls across the board were a “long overdue correction” caused by markets’ realisation the West is consumed by debt. “People have now woken up from their dreamland – things have been out of line for the last six to 12 months, and this is a dose of reality. “What it tells us is that QE2 in the US did nothing for jobs or growth, and has only kept the banking system alive for a little lo...