Inside an elite gathering in downtown Manhattan, investors discuss recession fears, yachts, and climate change - 'whether you believe in it or not'

Bradley Saacks/Business Insider

A wealth management conference in downtown Manhattan on Wednesday.

• Inside a bright room lined with exposed brick on the third floor of a downtown Manhattan townhouse, members of the investment community sipped cucumber-and-mint-infused water and discussed recession fears, geopolitical issues, and the yacht market.
• At this wealth management event held on Wednesday, thrown in part by a lifestyle media company and an asset management firm, the chatter captured what elite investors, economists, and decision-makers are dwelling on.
• Among the topics that men and at least two women discussed were investing as international trade-relation uncertainty lingers, as well as the family office space.
• "It's not really quantifiable - it's completely an emotional purchase," said Bianca Nestor, a charter broker for Burgess Yachts, responding to an attendee questioning a yacht investment's practicality.
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Inside a bright room lined with exposed brick on the third floor of a downtown Manhattan townhouse, advisers for the ultra-wealthy congregated to discuss the state of their assets and sip cucumber-and-mint-infused water.

They spoke of global economic recession fears, issues like populism and climate change, public figures like Elizabeth Warren, and the yacht market.

At this wealth management event held on Wednesday, organized in part by a lifestyle media company and an asset management firm, the chatter captured what elite investors, economists, and decision-makers are dwelling on as global growth slows and the US readies for the 2020 presidential election.

Among the issues that men and at least two women discussed were investing as international trade-relation uncertainty lingers as well as concerns particularly to family offices - the private, secretive firms that deal with affluent families' complicated financial lives.

Concerns of a possible recession - something that Nancy Davis, the founder of hedge fund Quadractic Capital, told attendees "is coming" - were not ignored. Still, the event quickly jumped between how the wealthiest people can protect their money in a downturn to how they can spend it right now, with pitches from companies that offer yachts, private jet services, and art sourcing.

'I may be out of my mind'

Bradley Saacks

A slide presented to attendees at the conference during a private jet chat queries: "Why don't I just buy a plane?"

There was significant interest in sustainable and impact-oriented investing options, and the conference had several speakers with sharp opinions on the field.

There was talk of investing in water. Marc Robert, the chief operating officer of Water Asset Management, said investors ought to consider climate change as an investment strategy, "whether you believe in it or not."

Standing next to him was Michael Underhill, the chief investment officer at Capital Innovations, who described a period of "enlightenment" in timber and said that market was on an upswing.

Another presenter, Eric Glass, a portfolio manager at asset manager and event host Alliance Bernstein who runs a fixed income impact investment strategy, told the audience he wanted to convince them to "join a movement" as a slideshow projected lyrics from Pink Floyd behind him.

His strategy invests only in "historically underserved communities" through municipal securities, and Glass cited Boston Medical Center - which helps raise life expectancies in poor communities with preventative care - as an example.

"I may be out of my mind to try this," said Glass, who used to run a homeless shelter, "but it's fun to try."

Glass tried to distinguish his strategies from others in the sustainable space, criticizing his industry for not doing more to match their marketing materials.

'Let's all go buy a yacht!'

To be sure, the backdrop is dimming. Chief executives' confidence has fallen to the lowest level since the global financial crisis, and a reading of global economic policy uncertainty is near its highest in at least two decades, Goldman Sachs strategists said in a report last week.

But the afternoon's agenda made it clear the advisers in the room are interested in more than just protecting their clients' wealth.

During a lunch of pesto chicken, roasted vegetables, and garlic bread, the World Human Accountability Organization - a group founded in 2016 to "blend charity and corporate investment" according to its chairman Frederick Newcomb - gave a presentation highlighting the need for those in the audience to "solve the global issues" like poverty, education inequality, and environmental protection.

Read more: A record number of big fund managers are worried governments aren't doing enough to avoid a global recession

Yacht companies, private jet salespeople, and art purveyors followed.

"It's not really quantifiable - it's completely an emotional purchase," said Bianca Nestor, a charter broker for Burgess Yachts, responding to an attendee questioning a yacht investment's practicality.

Nestor added: "Whatever costs are involved with buying a boat or chartering a boat are completely trumped by the experience."

Questions from the audience came pouring in for the reps from these companies, especially compared to the lawyers and economists that had presented before.

There was still a focus on professional services - for example, a presentation from McDermott Will & Emory lawyer Steve Eckhaus that included the line "the rich like to avoid taxes whenever they can, of course" was well-attended.

And there was a decent amount of speculation about the tax environment more generally. "What happens in a populist moment?" Eric Winograd, the chief US economist at AllianceBernstein, wondered in front of meeting attendees. He brought up ta proposed wealth tax from Elizabeth Warren, a Democratic US presidential candidate, as underscoring a global populist wave.

But advisers were noticeably more engaged for the sexier panels.

As Nestor finished her talk, a conference MC said, "Let's all go buy a yacht!"