Edward Bonham Carter: Bonds seem to have the potential for destruction of wealth

However, as prudent Fund Manager was to focus on his duties of Chief Executive at Jupiter, it is no mood to risk a rash prediction shirt new year.

Thank God he agrees that "a realistic plan, one can talk about his thoughts on the primary results for future probabilities."

Where are the risks for the new year and rewards? Bonham Carter Unveils some macroeconomic surprises, see a continuous outcome of excessive leverage effect that led to the last crash with the pockets of consumers and Government budgets both reduced sensation.

Indeed, it is up to compare Government of monetary easing withdrawal program a heroin addict on methadone, rather than to implement snapshot cold Turkey. "This is a kind of similar image," said, "because the pain of withdrawal monetary support and instant Apr would be fairly depressed in the economic sense of the term in terms of sense as well."

Bonham Carter is also resigned to "structurally high" United States and United Kingdom rates of unemployment for a period of time, while it is much less hard on UK rate than those who see 3pc base rates in a year.

His instinct is that the dollar may be stronger in 2011, due to the strain, the euro is underway, but he does not believe that the year will be the destruction of the common currency.

Inflation, Jupiter is always "disinflation camp" in the short term, but increased risk stagflation. "Largely price things that the world is on and that this country needs import, such as energy, freight and some food products, go, while wages and real personal disposable income will be under pressure," he said.

"This is a bad squeeze, so economic pliers are applied in the short term." That offset, corporate tax rates are down, and I think the prospects for investment capital are reasonably robust.

Indeed, it holds that one of the major differences of this post-credit crunch, environment compared with the other lulls and recessions, is that the business sector is in rude health in terms of profitability, cash flow and balance sheet positions workflow.

"People have been retains capital investment due to the weakening of the economy," he said. "But because of relative health of enterprises, they arrive to increase their investment in measures and spaces increased productivity and profitability to contribute." I suspect that is one of the brightest of the economy. »

How is Jupiter make money in this climate for its investors? Unsurprisingly, Bonham Carter says the company with funds under management "mutual funds of investment-linked" 75pc and its customers, based on the United Kingdom 92pc will cling to its knitting. This means that retain its preference for actions on bonds and other categories of assets to protect against rising inflation risks.

"Over the authorities continue to reach for the different versions of the quantitative easing, the probability of an inflation rate increased by surprise," he said.

"In this context, links seem to have potential for destruction of wealth in nominal and real terms." But if you invest in shares of companies who pay - 3pc to 4pc, dividend yields and prices 12 to 14 times reports with the ability to increase yields over time, giving investors a good chance of getting a real return.

"While price actions are obviously volatile, if you hold your investments for three to five years, the volatility of the payments of share is much, much less." At least two-thirds of return to investors who hold shares are dividends and the reinvestment of the dividends, we spend too much time being overly concerned the stopper in the short term relates to the waves of volatility. »

It not be attracted very far on what will happen to the FTSE 100 index in 2011, however. "In short, it is that he will fluctuate," he deadpans.

Position of Jupiter during the last decade has been the FTSE 100 is a "large sideways deals range from market", take many years for the index back to its high of 6930 December 1999. But he said that Jupiter forecasts never the FTSE 100.

"I think it is wrong to do so because even if I gave you a figure, the interesting thing on the market would be how we arrived it y."

Is it even say if he thinks that the FTSE100 will be higher than a year that today ' today? Yes, they have. "I think it will be probably higher in directional terms."

Fortunately, there is much stronger on the direction of Jupiter. Bonham Carter says that Jupiter will remain UK-centric in terms of customers but increasingly global in terms which it invests.

"Global" funds currently represent 24pc of its invested assets and Jupiter boss sees continuous opportunities for attractive yields in the development of markets. However, it also believes that long-term trends will be beneficial for the mutual funds for the British market. "A huge chunk of assets people are not surprisingly in cash deposits and then there are large pieces of pensions and life companies" he said.

"Mutual if deprive you investment coming of pensions and life, business sector is still relatively small when you compare the United States.

"I am not saying that we are going to go to u.s. levels of penetration, because they have a different culture and economies of different structures but the United Kingdom is moving towards the American system by requiring people to be more responsible for their savings and giving them options"
to do this.

"Unit trusts have been stress tested by the credit crunch and have out fairly well." As a collective vehicle they did what they said on the Tin.

"They remained open for business." They are transparent vehicles. For the average investor, they offer professional management and diversification benefits which, over time, are quite interesting when compared with other products, such as life products in many cases. I think therefore that we will benefit by being within UK mutual funds. »

It will be difficult to replicate enterprise success of Jupiter 2010, however, well that the company has shaken finally off the coast of the shadow of its founder, John Duffield, returning on the stock exchange where he floated in 1991, before its sale to Commerzbank the Germany three years later.

Ironically, Jupiter now accused of floating too cheaply last year —, but he used the proceeds to pay expensive with a coupon of 10pc which was a relic of the redemption management of 750 million preferred shares for £ led Bonham Carter in 2007.

"We just believes that taking into account the uncertainties in the world it was prudent to pay that off," he said. Very present, caution, at least in its public statements, is a characteristic that investors may have reliable betting on Bonham Carter showing in 2011.

Education Harrow, University of Manchester.

Married to Victoria, three children - Tobias, Maude and Harry

HousesBarnes and New Hampshire

Interests cycling, yoga, table-tennis

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