Fed Exit Will Cause Liquidity Crisis Says Context Asset CIO

The Federal Reserve’s massive infusion of cash in the wake of the financial crisis has created a new problem for the market in the return of volatility said John Culbertson, chief investment officer at Context Asset Management. 'We’ve had what I call systematic volatility suppression in the central banks,' said Culbertson. 'It’s in their best interest to keep volatility low, allow us to grow out of what was the financial crisis. There are implications however when stimulus gets slowly pulled away from the market. So what does that mean? It means that volatility will probably pickup as the Fed backs out of the market.' Context offers alternative mutual funds that connect its clients to emerging and established managers. Context offerings include multi-alternative, long/short equity, managed futures and global macro strategies.