Mohamed A. El-Erian

Mohamed A. El-Erian


Chief Economic Adviser, Allianz. Author of NYT bestsellers "When Markets Collide" and “The Only Game in Town.”

228648 followers  •  855 follow  •    •   https://t.co/VyDNpr6LI5

This is consistent with #markets  pricing in lower global growth and, in the case of some of the over-extended companies,a tougher liquidity/solvency outlook As you know,I’ve been surprised how quickly both consensus economic and market views dismissed the #coronavirus  shock as...

#CoronaVirus  shock is a test of the technicals (FOMO/Buy-The-Dip conditioning) that helped #stocks  overcome fundamentals/valuations headwinds. A key element is whether #markets  distinguish between #CentralBanks ' willingness (high) and ability (low) to counter the economic shock.

Interesting questions after today's selloff which triggered concern among retail investors(per @Fidelity  and @CharlesSchwab  indicators)&lacked decisive "buy the dip" reaction: Are #markets  more sensitive to economic/corporate fundamentals? Will the faith in #CentralBanks  prevail?

With this financial (risk aversion) background adding to the mounting economic concerns, #stocks  in #Japan  opened down some 4%. Keep an eye also on emerging economies, particularly in #Asia , where economic and financial vulnerabilities to #CoronaVirus  spillovers are significant.

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A #markets ’ tug-of-war so far this early morning. Hope of a repeat of an historic pattern (see @CNBC  chart) led initially to a bounce back in stock futures. This is now coming under some pressure as #traders  also keep a worried eye on yields which are now lower on (young) day.

My thoughts on insights from #GameTheory  as applicable to the ongoing search for new (and more effective) central bank tools. @bopinion  #centralbanks  #economy  #markets  @federalreserve  @ecb  @CNBC  @TheEconomist  @economics  @markets  #BehavioralEconomics  @FT 

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Together with lower #stocks , yields on both 10- and 30-year US government #bonds  just traded at record lows. While the overall level of yields is still influenced by negative-yielding bonds in Europe and Japan,the recent leg down is a reflection of poorer global growth prospects

Judging from what companies are now saying and revisions in economists’ Q-1 global growth projections, there’s growing recognition of the damage caused by economic sudden stops Having said that,most economists (though not companies) are still holding on to the notion of a sharp V

Another ugly market session with the Dow down 2% and 10-year US government bond yields at a record low. The magnitude and nature of the recent sudden market drops will fuel concerns about technical dislocations possibly triggering more selling — this as fundamentals also weaken.

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... and the perfect Sunday morning shirt after yesterday’s Champions league final in #Madrid . @ChampionsLeague  @UEFA  @22mosala @LFC #egypt 

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Here's with the latest on the cr #Cataloniasis , including reactions to measures announced by PM #Spain  #Rajoy 

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As much as I hate saying this, I strongly suspect that these estimates of the CoronaVirus-induced hit to GDP may well prove too optimistic — across the broad. #ft  #economy  #markets  #china  #coronavirus  @FT 

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Another example—from #France  — of the ripple economic effects of the #coronavirus . Points to a wider phenomenon that makes the consensus characterization of a “transitory” economic shock—ie, a sharp V due to a quickly containable, temporary and reversible impact—less realistic.

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A huge thank you to all who have worked so hard, and are working so hard to make #EEDC  such a great success. Superb job. #EEDC2015 

In riding big liquidity-driven #markets , #investors  should remember the surfer analogy: The bigger the wave ... the greater the ride; the more tempted you are to stay on; the more uncertain the when and how it breaks; and Only the best of surfers get off really smoothly.

Thanks @lisaabramowicz1  Another indication of elevated asset prices increasingly decoupled from weakening fundamentals and ample/predictable central bank liquidity inadvertently encouraging excessive risk...which raise corporate incentives to over-borrow/over-financial engineer.

Peaceful in #LagunaBeach  as police separates small group of outside protestors from bigger counter protest--in no's,ideas,tolerance & impact

Ongoing spike in reported #CoronaVirus  cases, together with the initial growth dynamics, risks adding #Italy  to the list of countries now facing a significantly higher risk of recession. Unfortunately, it’s an expanding list that already includes Germany,Japan,Korea,Singapore etc

This sharp fall in yields on US government #bonds  —the 10 year is now #trading  at 2.62% in reaction to #Apple ’s signals about weaker global growth—is truly remarkable ... and especially given that the #Fed  has been reducing its balance sheet and the tapering its . #QE  #china 

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