El-Erian: Get Used To Deleveraging, It's Going To Continue

Mohamed El Erian spoke with CNBC this morning about the status of U.S. markets, specifically how disappointing revenues are impacting equities and new regulation.

  • 0:30 The market is saying lets look at top line revenue, they want to see growth and sustainable earnings.
  • 1:25 For a while revenue growth is going to be muted as deleveraging continues.
  • 1:50 Growth economies are managing success well, growth is migrating to the emerging economies.
  • 3:15 Financial regulation is coming to impact the flow of credit, but it might be useful in the long run if it can protect us from risks.
  • 4:00 If you are worried about accidents, financial regulation is good.
  • 4:30 The political system is reacting by increasing regulation to stop the socialisation of losses.
  • 5:00 In order for us to navigate markets, we have to accept what is reality, not push for what we want.
  • 6:45 The mindset in Washington is coming up with cyclical responses to a structural problem.

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