It’ll get tougher, warns City veteran

Investors take heed. More financial turmoil is heading our way as the sub-prime crisis continues to impact upon the global money markets. The warning is sounded by veteran stockbroker Elissa Bayer. One of the first women to become a member of the London Stock Exchange, Mrs Bayer, 55, is director of private clients at investment bank Insinger de Beaufort. She says the effects of the credit crunch are far from over. “The fallout from the sub-prime crisis will take at least another 18 months to sort out and we will get different problems,” she tells JC Business. “And when we come out of this, the next concern will be that America will become less powerful and countries such as China, India, the Gulf, Singapore and the Far East, which have loads of money for different reasons — either because they are very successful or have oil — will form a much more significant bloc. “Although we are very tied to our American relationship, we will look to these other countries instead. We will continue to see a reduction in American authority. The whole dynamics will change.” The outlook for European and Swiss banks also remains bleak. She says: “There is still bad news still coming out [of these banks]. The problem is that the sub-prime crisis is involved in products that the banks have packaged and re-packaged and then sold to other banks to get the liability off their books. Some banks still do not know their total liabilities and that’s the worrying thing.” But Mrs Bayer has seen it all before, having worked in the City for more than 35 years. She began her broking career in 1972 at City firm Joseph Sebag, part of the Montefiore family empire. She recalls: “The markets had been rising like mad. But 1973 came, and with it the Yom Kippur war and oil problems. A very high proportion of the City lost their jobs. It was quite a depressing time.” She was exposed to market volatility again during the late 1980s. “The banks had lent huge amounts of money to people because the stockmarket had been going up for so many years. Then, when the market started to go down, the banks called in all the money and people found that they couldn’t pay for their shares. I was responsible for sorting [part of] it out. It changed my view on investment.” She notes: “Investors have to live with constant change. You are always going to get market volatility and you have to be aware of that. Part of the problem is media interest. Everyone is supposed to have quick-fire reactions today.” Last year, Mrs Bayer was named one of the most influential women in wealth management by Global Investor magazine. She is a regular financial commentator for media including BBC2 and Radio 4. As for the UK’s prospects, she says inflation remains a key economic concern. She acknowledges the Monetary Policy Committee’s decision to keep interest rates at 5.25 per cent indicates a fear of inflation over concerns about the slowdown in the UK. “Because the cost of commodities is rising, there is very little scope for them to reduce interest rates — maybe by another quarter point or a maximum of 0.5 per cent for the rest of the year. The Americans are happy to keep bringing rates down even though inflation is rising on a global basis, but this is not a tool that UK monetary policy is going to use, despite falling retail sales and property prices.” Although coming from a business household, Mrs Bayer was not always destined for the business world. “I was planning to read history at university but my schoolteachers said I would be better in business. I was terribly upset at the time but got over it.” She completed a business course before joining Joseph Sebag. In 1976, she moved to Grenfell & Colgrave, and then to Gerrard — now Barclays — where she spent 25 years, becoming head of the private-client department. In 1980, she became the 17th woman member of the London Stock Exchange — Denzil Sebag-Montefiore acting as her sponsor. She joined Insinger de Beaufort in 2006. An Orthodox Jew and mother-of-three, she admits that the juggle has not always been easy. “I remember one week when I was doing a deal and finishing at midnight every day. My husband Max had to do all the Pesach shopping. It is a very busy life with a lot of juggling.” She gets up at 4.45am most days. The Edgware Federation Synagogue member confides that being a woman in business has its advantages. “When it comes to stocks and investing, women see things in a different perspective and that’s an advantage. We are better at listening and are intuitive. Women have their advantages and you have to use them. But you have to be professional. I don’t cry very often in the office.” She agrees that women are continuing to break through the glass ceiling, but says many are shying away from the corporate lifestyle. “I think men and women today do not want to work the City hours. They want more of a work-life balance. Mrs Bayer is a member of charity Emunah. In 2006, she participated in the first Emunah Jewish Princess Odyssey, raising £21,000 for the charity. Home is in Edgware, Middlesex.

    Last updated: 11:10am, August 19 2008