CHICAGO, Janaury 5, 2012 – Mesirow Financial's business leaders today announced their forecasts for 2012 in several key financial markets. The theme for this year's forecasts, "Finding a Balance: Insight to Help You Understand Today's Markets and Identify Opportunities in 2012," addresses both the opportunities and challenges anticipated in the year ahead. More than 20 of Mesirow Financial's practice leaders have provided perspectives on a number of critical investment, advisory and consultative businesses, including currency, private equity and insurance, among others.

Chairman and CEO Richard Price noted that the firm's business leaders, "are among the most insightful, dedicated and respected in their industries." He added, "Access to this level of knowledge and innovative thinking is what our clients have come to expect, and what we have proudly delivered for 75 years."

Each of the forecasts are available at the firm's website and include:

Advanced Strategies
2011 saw the second consecutive middling year for hedge funds with few risk asset categories offering potentially attractive returns.

Compensation and Executive Benefits Strategies
The opportunities for talented sales professionals and senior executives has improved.

Credit Tenant Lease Finance
CTL volume forecasts for 2012 are positive and forecast growth in product financing volume.

Currency/Commodities
As both the world and investment portfolios have become more globally connected, it is our view that the impact of currency on investments – as either a risk factor or potential opportunity for added value – has never been as important.

Fixed Income
While this sector offers little opportunity for compelling returns in the coming months, yield spreads on most non-Treasury sectors are much wider than usual, offering investors the potential to earn excess returns when spreads revert to historical averages.

Insurance – Property and Casualty
The property and casualty insurance market is finally showing signs of hardening. While the U.S. was fortunate to avoid huge catastrophic losses, the rest of the world did not fair so well.

Insurance – Life and Disability
In 2012, carriers may continue to increase pricing to make up for capital losses, given the volatility of the market the last 12 months.

Insurance – Employee Benefits
Since the enactment of the Patient Protection and Affordable Care Act, a series of repeals, delays and the release of additional guidance has been the order of the day, while the cost of benefits has continued to increase.

Institutional Real Estate, Multi-Manager
In 2012, we expect to see more opportunities in distressed debt in developed markets, with significant distress in Europe as liquidity gets sucked out of the market.

Institutional Real Estate, Direct
We believe that good opportunities for investment exist today, particularly in specific submarkets in the multifamily and industrial sectors.

Institutional Sales and Trading/Public Finance
We look for the first quarter of 2012 to dictate the tone of the market for next year. We should know by the end of the first quarter whether we will see additional quantitative easing by the Federal Reserve and what form it might take.

International Economy
We see the likelihood of a recession increasing in Europe, a downturn that will fully play out in the first half of 2012. While China, Brazil and other emerging economies continue to grow, the pace may slow if U.S. growth is moderate and Europe stalls.

Investment Advisory
Volatility is the new normal. Good investment decisions are made by focusing on the long-term economics of businesses and the price paid for debt or equity in those businesses.

Investment Banking
Overall, the strong M&A environment experienced in 2011 is expected to continue into 2012. Cross-border M&A activity may face the most significant headwinds due to uncertainty around the European banking system, as well as continued economic and sovereign concerns.

Investment Strategies
We expect a continued increase in demand in defined contribution plans as a major source of funding for retirement, and the products and services offered in this arena to increase in sophistication.

Mesirow Financial Consulting
The trend of operating with increased levels of cash and cash equivalents continued throughout the year as memories of 2008/2009 persisted. Globally, marginal borrowers will be on the "outside looking in" in 2012.

Private Equity
The private equity fundraising environment was difficult in 2011 and looks to remain that way, particularly for raising new funds, in 2012. On the investment side, we expect buyout activity to resume a more normalized pace while liquidity remains tight.

Real Estate Consulting
Heavy inventory levels, high unemployment and weak consumer confidence continue to impact the residential market, with some growth forecast for the multifamily sector.

Retirement Plan Advisory
Retirement plan fiduciaries continue to be challenged by legal and regulatory issues, volatile markets, operational complexities and savings rates for participants.

Sale-Leaseback Capital
In 2012, volume should exceed that of 2011, yet supply will continue to be constrained for high credit tenant deals.

U.S. Economy
Despite the size of the American economy and the determination of policymakers at the Fed, the U.S. is not an unsinkable vessel and can quickly lose steam while navigating to avoid icebergs that have been cut loose in the global economy.

U.S. Value Equity
Given low Treasury yields, a near-certain recession in Europe and a slowing Chinese economy, the U.S. equity market is attractively valued.

Visit Mesirow Financial's website to read the full-text forecasts, view a video presentation from eight of our key investment businesses or download a PDF of our complete Outlook Booklet.

Mesirow Financial is a diversified financial services firm headquartered in Chicago. Founded in 1937, it is an independent, employee-owned firm with approximately 1,200 employees globally. The firm is well capitalized and has been consistently profitable, with capital of $302 million, revenues totaling $510 million for fiscal 2011 and $59.1 billion in assets under management, of which $31 billion are in currency and commodities as of September 30, 2011. With expertise in Investment Management, Global Markets, Insurance Services and Consulting, Mesirow Financial strives to meet the financial needs of institutions, public sector entities, corporations and individuals. For more information about Mesirow Financial, visit mesirowfinancial.com.