PIMCO’s Mohamed El-Erian says it’s “too early to declare victory”, despite the strong recent jobs numbers. El-Erian does tell CNBC that the numbers are very encouraging, but adds that it is critical that “nothing be done to interrupt this wonderful cyclical bounce”, so that the cyclical bounce becomes a secular bounce. El-Erian also says he thinks the activeness of central banks makes it unlikely that the European debt crisis will lead to a market-halting Lehman… Read More
PIMCO’s Mohamed El-Erian says the odds of a new U.S. recession are between 33% and 50%. “This is a fragile economy,” El-Erian tells Bloomberg. “It doesn’t mean we don’t have strength. We certainly do. The corporate sector is as strong as we’ve ever seen it in terms of balance sheet. We have incredible entrepreneurial spirit. But we are facing all these structural headwinds.” He says the right tact for investors today is to be “generally… Read More
In a rare joint interview, PIMCO’s Mohamed El-Erian and Bill Gross say that the US will continue to experience slow growth because of structural problems with the economy, and that the public sector must step in and spend money in areas in which the private sector isn’t willing to do so. Gross tells WealthTrack’s Consuelo Mack that he sees growth of 0% to 1% for the U.S. in the next 6 to 12 months, which… Read More
PIMCO CEO Mohamed El-Erian says that if passed, the proposed debt ceiling compromise should be enough to lift markets across the globe. “This two step agreement is sufficient to lift the threat of a U.S. default and will therefore fuel a relief rally in markets around the world,” El-Erian tells Dow Jones Newswires. El-Erian added, however, that even with passage of the proposal, the U.S. could still be downgraded by credit rating agencies. “The impact… Read More
PIMCO’s Mohamed El-Erian says he’s more optimistic than he was a few months ago about U.S. deficit reduction, though he says it’s a complex issue that won’t be easy to tackle. El-Erian also talks with Bloomberg’s Tom Keene and Ken Prewitt about why interest rates are remaining low despite concerns about U.S. credit quality. [youtube=http://www.youtube.com/watch?v=Y1lskW9Lk_k]
Several top strategists are saying that investors should stick with stocks as the bull market enters its third year. Among them: hedge fund guru Barton Biggs. “I don’t think valuations are stretched,” Biggs told Canada’s Financial Post. “The next move in the S&P 500 is more likely to be up than down, and that move could be 10% to 15%.” Laszlo Birinyi also remains bullish, saying that investors who have missed the first big wave… Read More
PIMCO CEO Mohamed El-Erian recently offered his tips for how the government can deal with current economic problems, and his insight on what’s happening in the global economy. El-Erian tells CNBC that his firm’s view is that structural problems in the economy need structural solutions, something policymakers tend not to address.
PIMCO’s Mohamed El-Erian says he thinks there is a 25% chance that the U.S. will run into deflation and a double-dip recession. “I do not think the deflation and double-dip is the baseline scenario, but I think it’s the risk scenario,” El-Erian says, according to Bloomberg. He also says unemployment will probably stay unusually high. El-Erian says that the trend of companies piling up cash and consumers saving make it difficult to fight deflation, Bloomberg… Read More
PIMCO’s Mohamed El-Erian says that the “new normal” is starting to play out, with a lack of top-line growth causing the market to adjust and reprice. “For a while, revenue growth is going to be muted until we finish the deleveraging process,” he says. El-Erian says he thinks that process will take “a couple of years”.
PIMCO chief Mohamed El-Erian still sees a slow-growth “New Normal” for economies and investors, but he doesn’t think that New Normal will last forever. El-Erian tells CNBC that he sees the New Normal as a 3 to 5 year phenomenon, and that the U.S. can move past it as balance sheets improve.