Many of the discussions Kelly Jernigan has entertained have been about the status of the dollar and whether it would retain its standing as the world’s reserve currency. He insists, “The dollar is still the place to go for safety.” The Chinese, he believes, are allowing a slow appreciation of their currency to help grow their own consumer market.

Greece

Another country that demands attention, all agreed, is Greece. “Where will Greece’s crisis come to its final and ultimate conclusion?” asked Randy Hallier.

Brian Perott described the likely default of Greece as “ripping off a bandage.” He added, “Just let’s default, let’s put the backstops in place, renegotiate some of the debt, extend it and move on.” The lingering crisis is arguably worse than an abrupt fix.

“I think the chances are there will be a structured default,” said Pete Martinez. “They’re going to take and let some debt go.” He believes that a complete default by Greece would be devastating to the European banks right now.

Chris Costello does not believe that the exposure of European banks is too high. “I think that they should default,” he said. “I think it’s going to be a short-term, knee-jerk reaction, but I think ultimately [the European banks] can absorb it.”

Perott compared Greece to Argentina in 2001, which underwent a structured default, which he sees as necessary: “If I’m a German citizen,” said Perott, “I’m getting tired of bailing out my neighbors who don’t feel like paying their taxes.”

“It has to be structured,” said Scott Boswell, “because the risk isn’t for Greece. The risk is for what follows Greece.”

That risk is Italy, Kelly Jernigan said, because of what’s being held on the balance sheets of French banks. Technically, he believes Greece is already in default. “The exposure of the French banks to Italian debt would be crushing to the French banking system,” he said. “So I do think you’re going to have a structured default.”

The other risk, said Costello, is a run on the European banks. They have no FDIC insurance. “There’s nothing in place to stop that,” he added, “and not one country is powerful enough to step up and hand them stocks or bonds.”

“Quite frankly,” said Mike Brown, “their banks just aren’t as strong as our banks. Their balance sheets and the type of lending they do they don’t have near the capacity of what we do.”

As Martinez noted, though, it was Germany that recruited Greece into the EU without checking its balance sheets.

Political Environment

European politics are obviously not the only kind of politics affecting market performance. Mike Brown wondered what we could expect to see around the world and closer to home.

Molly Kerr sees a huge shift towards emerging developing economies. She believes that shift will greatly affect the way “we look at the world, how we look at politics, how we look at asset allocations.”

“If you take the population of the United States and the population of Europe,” Steve Soden observed, “it only represents 10 percent of the world.” He expects to see much more focus on the other 90 percent in the years to come.

Clients worry more immediately what the American political landscape will look like in Jan. 2013, suggested Martinez. “There are a lot of concerns about taxes,” he said. “There are a lot of concerns about the Obama health-care plan and what it means for all of us.” He fears that some clients will see tax increases of 5 to 8 percent slamming their bottom line.

“That uncertainly is hurting the economy,” affirmed Soden.

“That puts a lot of pressure on us to become more educated,” said Mike Brown, “to help our customers navigate this.”

Brenna Stewart conceded that she did not know how the elections would play out. No one does.

“So regardless of what happens,” she said, “what we want to do for our clients is make sure they’re going to have a financial plan in place that will get them through it in a way that adds positive returns to their portfolio and puts them in a better position after everything has fixed itself or until the next crisis happens.”