The great migration begins from the land of savings to the land of investment.
The world of investment in Spain is at the starting point of one of the largest migrations in history, as necessary as it is overdue. After years of not being able to achieve some return on savings due to zero interest rates, the opportunity to start making risk-free returns caught on among those who had money in the banks just to keep the Don safe. I don’t put it under the mattress.
After last year’s queues at the Bank of Spain to subscribe for treasury bills, savers have realized the benefits of the financial island we live on, with the ability to transfer without going through the Treasury between funds, which has forced many investors to reduce their cash holdings. In just five months Contributions to these products amounted to 75% of the total investment in 2001, a record year to date.
In my opinion, one of the greatest migrations we will experience in the world of investing began with the transformation of savers into investors. The 6500 million euros flowing into foreign exchange is a demonstration that in addition to the insatiable appetite for letters, money dying of laughter without profitability is moving into products from which they can make some profit with little risk. There are many investors who appreciate giving up a few tenths of the profits they make. They offer letters to the Fondtesoro Commission with which they avoid taxation.. And it is these same investors who will start increasing the duration of their fixed income funds as the next step in their exposure to investment products, once falling rates become more evident.
If the progression continues and the amount of money available for investment increases because it is not needed, or concerns about government pensions increase, the portfolio will see corporate debt, emerging debt, high-yield funds, mixed funds and finally . variable income and venture capital. Investments in business projects involving greater risk, but saving time, will always offer the highest profit.
The number of Spaniards who emigrated to Spanish America in the first colonial century of the 16th century is estimated at 100,000. It is assumed that later, between 1800 and 1940. 55 million crossed the pond. Accelerating the transformation of savers into investors is quite possible. And after a few years I am convinced that the assets invested in the funds will be more than what is spent on liquidity and deposits. I am even more optimistic: I hope that the ratio of financial assets and real estate assets will be balanced. Today, out of every five euros invested by Spaniards, four are in real estate.