“This is not the crisis within the global system. This is the crisis of the global system.”
Those were the bleak words of Mohamed El-Erian, the chief executive officer of PIMCO at a press briefing of Allianz Global Investors yesterday.
El-Erian also said:
- No Reset Button. “Internal circuit breakers are meant to deal with crises within the system. The crisis of the system challenges all the circuit breakers. There is no reset button.”
- Government Will Set Asset Values. “You can no longer predict asset value without thinking about the role of governments. Governments are no longer referees, they are players.”
We don’t know if El-Erian intended to rebuke General Electric CEO Jeff Immelt, but it’s hard to read these remarks and not think about Immelts remarks from November 2008. “This economic crisis doesn’t represent a cycle. It represents a reset,” Jeff Immelt, the CEO of General Electric said after Barack Obama was elected. “It’s an emotional, social, economic reset.”
Microsoft’s Steve Ballmer also referred to an “economic reset” recently.
Was El-Erian telling these guys to get real?
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