Empire of IOU: the investment megatrend of government spending and sovereign debt – New York Life Investments – 9.26.25

Summary:

The time is now to have a new conversation about how major governments spend, save, and manage their sovereign debt. The U.S., Europe, Japan, and China are each at an inflection point in their economic path, and their choices will carry dramatically different consequences for growth, inflation, and global asset allocation.

Our debt sustainability framework measures how a country manages demand for its sovereign debt, the quality of its government spending, and the role of the central bank. Join us as we apply this framework to four major economies:

• United States: Can policymakers restore credibility and rein in surging interest costs without risking global demand for Treasuries?
• Europe: Will a renewed willingness to invest in defense and infrastructure move Europe past austerity, into an era of growth?
• Japan: Can policy shifts reshape a debt model built on decades of central bank intervention?
• China: Is austerity without capital markets liberalization locking China into a structural slowdown?

We will explore the market and asset allocation implications of the next era in sovereign debt management: what do shifting debt paths mean for equities, bonds, and private markets?

Accepted for 1 CFP / IWI / CFA CE Credit

Speakers:

Julia Hermann is a Global Market Strategist at New York Life Investments. As a Director on the firm’s Global Market Strategy team, she is responsible for economic and market research, asset allocation perspectives, and thought leadership to empower investment decision-making.

In the macro world, the biggest part of the job is sifting through the noise of macro data, market tumult, (geo)politics, and news flow to find “what matters” for investors. Julia enjoys the process of breaking down complex macro and market developments into insights that help financial professionals and clients invest confidently.

Julia is co-host of New York Life Investments’ economic and market podcast, Market Matters. She is an experienced public speaker, writes extensively on global macro and capital markets topics, and has been featured on media outlets including Bloomberg and CNBC.

Prior to joining the firm, Julia was the global macro strategist for an emerging markets equity fund. She is a CFA Charterholder, graduated cum laude from the University of Notre Dame and holds a Master’s Degree in International Economics from Johns Hopkins School of Advanced International Studies (SAIS).

John Pavese is a Managing Director and leads the Global Relationship Management team which includes research platforms and Defined Contribution Investment Only (DCIO) key account functions for New York Life Investment Management Third Party Distribution. This key role positions the development of platforms that provides all related business development, client support and retention efforts of NYLIM’s major intermediary clients from home offices and the field. He and the GRM team are instrumental in leading sales professional to broaden our relationships and providing a more comprehensive client experience with NYLIM.

John serves on the Board of Directors for Invest In Others, which amplifies the charitable work of financial advisors and their firms to make a difference in communities across the globe. He also serves on the Board of Directors for the Expect Miracles Foundation which rallies the financial services industry life-saving cancer research.

Prior to joining New York Life Investment Management, John was the Head of Third Party Relationship Management for the Investment Solutions Group at Bank of America/Merrill. Prior to joining Bank of America, John was employed by UBS Financial Services where he was a Corporate Vice President, National Relationship Manager/Product Manager with the Mutual Funds Consulting Services Group. John received his B.S. in Marketing from Kean College in New Jersey and lives in New Providence, New Jersey with his wife Melissa and daughter Nicole.