Comments 11

肆虐市场的风暴结束了吗？

Mar 9, 2016 Mohamed A. El-Erian

发自拉古纳海滩——今年早些时候，世界各地的金融市场都被迫在一场完美风暴中艰难航行——这是一场由众多小型干扰因素的异常合并所助长的暴力破坏。金融震荡加剧，令投资者如惊弓之鸟；股市如过山车般上下翻飞，最终往往是大跌收场；政府债券收益率大幅下降，同时贷款人发现自己处于一个尴尬境地：他们甚至要为持有总额更庞大（占总数近三分之一）的政府债券而额外付钱。

这些干扰因素持续时间越长，受到结构性弱点，收入和财富不平等，过度负债，过度负债，总需求不足，以及政策协调不足挑战的全球经济所遭受的威胁就更大。虽然金融市场已经相对恢复了平静，但导致波动的三大因素却尚未在真正意义上被消除。

首先，逐渐明显的中国经济疲软迹象以及该国一系列非典型的政策盲动令人们对全球经济整体健康状况的担忧日益增加。鉴于中国是全球第二大经济体，欧洲和国际货币基金组织的官员们也就迅速反应，分别调低了对本地区和全球经济的增长预期。

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Mohamed A. El-Erian

Writing for PS since 2010
109 Commentaries

Mohamed A. El-Erian, Chief Economic Adviser at Allianz, the corporate parent of PIMCO where he served as CEO and co-Chief Investment Officer, was Chairman of US President Barack Obama’s Global Development Council. He previously served as CEO of the Harvard Management Company and Deputy Director at the International Monetary Fund. He was named one of Foreign Policy’s Top 100 Global Thinkers in 2009, 2010, 2011, and 2012. He is the author, most recently, of The Only Game in Town: Central Banks, Instability, and Avoiding the Next Collapse.

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0 Comments on this paragraph, 19 in all 19 Comments on this article

Jukka Ilomäki Apr 8, 2016

I think the perfect storm is not over until we have proper significantly positive risk-free rates. Because only then positive development in stock markets, bond markets and commodities markets can be sustainable in the long run. Irving Fisher made this argument nearly 100 years ago. This is known as the Fisherian hypothesis.
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David Kinder Mar 23, 2016

10,000 Americans retire each day, that's 300,000 a month and this will occur for the next 15 years. Losing 300,000 workers/month and claiming to gain 250,000 jobs equates to a 50,000 job loss/month. I believe this phenomena is occurring in ALL of the developed nations! It's a race to the bottom.
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joey jay Mar 21, 2016

The office of the controller - City bank total exposure more than 50 million dollars...
270 trillion dollars exposure in the derivative bubble, of the big banks is unsustainable.
Cry me Argentina
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joey jay Mar 21, 2016

It is just beggining:
The derivatives' cassino bubble is coming to a head:

http://thefinalbubble.com/nht_v15/front-ctrl.php?param1=nht_v15&hop=hopesy
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M Chrisney Mar 15, 2016

A rising tide of negative nominal interest rates may have longer term effects. Unlike negative real rates, there is a profound psychological effect when nominal bank balances drop each month or a bond investor receives less cash back than the principal invested. In the larger picture, deflation is still a concern (particularly in the EU and Japan) and further cuts to nominal rates will lead to a triple threat: worsening credit quality (as economies decelerate further), lower interest margins, and reduced profitability. Even if these trends are cyclical, their effects on banks, and the financial, are destabilizing and likely to be long lasting. @mchrisney
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Diane Swonk Mar 13, 2016

The tendency to burden central banks with the economy's performance was not only misplaced, but allowed elected officials to blame central banks for lackluster growth in recent years. I fear that legitimate concerns about the role that central banks can play in stimulating growth will be overshadowed by scapegoating, and allow elected officials, particularly in the US to curb the independence of the Fed. This should worry financial markets at least as much as fiscal impotence in recent years. The focus on insults over issues is should also concern financial markets. What little the candidates are proposing does nothing to deal with our crumbling infrastructure, boost productivity growth, or reign in long term budget deficits.
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Paul Daley Mar 10, 2016

Good article. Central Bank's use of QE has driven a wedge between income flows and asset prices that's really not going to be corrected by a splurge in government expenditure. The cure lies in institutional adjustment -- allowing central banks to operate more like real banks, lending against income as well as assets, and taking on goals more akin to Hamilton's in his American system for the original Bank of the United States. Contributing capital to or buying bonds from an infrastructure bank similar to the one Hillary Clinton has proposed would be a natural way to augment income flows without drifting towards monetary funding of general government expenditures. El-Erian has put his finger on the problem of over-inflated asset prices, but needs to be a little bolder in pushing for one of the many solutions potentially available.
- Jose araujo Mar 11, 2016
  
  Paul, I kind of agree with you, my only problem with your approach is that I don't think banks have the expertise to lend to the riskier.
  
  Its also no the job of a Commercial Bank . You lend based on risk and collateral. That's their jobs and function on the financial market.
  
  Problem with Europe is that, most of the lending is done by commercial banks, and they tend to miss price risk. Lending to the riskier should be done by Investment banks and debt markets, they are the ones who know how to deal with volatility and portfolio management.
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- Steve Hurst Mar 10, 2016
  
  In the EU this would pressurise for lending to the most vulnerable, ie the highest interest rate parties, aka the highest risk. The implict objective would therefore be to reduce the transaction interest rates which in reality is a form of subsidy which ameliorates the imperitive to control budgets. As such I suggest it would be strongly opposed by Germany who remains the cash flush player in the Eurozone. It would almost certainly be subject to legal challenge
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Michael Public Mar 10, 2016

Its been raging since 2008. It just looked like it was over because the US quadrupled money supply through QE in the interim. It will rage on until 3008 unless some structural problems are fixed. Calling it a perfect storm implies some kind of bad luck. It is not bad luck, it is our very lack of understanding of what goes on that created this. Of course, the author is the poster child for making big money off speculating on markets, so don't expect much in the way of thinking that challenges the status quo.
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Jose araujo Mar 9, 2016

So 3 long term trends made a week of high volatility? Do you actually believe in that, or are you just unable to explain what happened?

China is landing for quite some time, Central Banks have lost their power long ago and oil returns and patiente capital have been missing for quite a while.

All this tendencies have been incorporated on asset prices a long time ago, so your explanation is no explanation at all.

Something happened that week, my hint goes to the situation of Deutsche Bank and Credit Suisse....
- Steve Hurst Mar 13, 2016
  
  @Jose
  The supreme art of war is to subdue the enemy without fighting. Sun Tzu
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- Jose araujo Mar 11, 2016
  
  @Steve
  
  I've been though that in science, first you generate the hypothesis, then you go and test it, that's whats been lacking in Economics, either you don't have an hypothesis to start with, or you have one and then just data mine to prove it.
  
  Regarding QE, IMHO, it has done nothing relevant, neither bad nor good. I have problems with other peoples problems with QE.
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- Steve Hurst Mar 10, 2016
  
  @Jose
  Random numbers cluster and are interpreted as being meaningful. If you do not believe this try using a random number generator and apply linear regression then make a decision based on that interpretation, good fun.
  
  Its classic instability leading to a cascade that self-reinforces. Further I refer you to the book of I Ching where events are either in growth or in decline and anything inbetween is a transient and pseudo stability. As far as the I Ching is concerned we are not in growth and not in pseudo stability so we can only be in decline.
  
  Thus all the signals are read negatively. The big animals move, the ground shakes and the My Little Ponies run and then the Pocket Gophers head for their holes. It will overshoot giving opportunity
  
  This is all about the fact 2008 is still with us despite having been fed by QE. China is running out of consumers, has debt to deal with. Consider where the West would be witout QE, then the fact QE cannot continue forever, you run out of assets to pretend to secure it on
  
  Regards
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- Jose araujo Mar 10, 2016
  
  Thank you Steve,
  
  The Italian article is old news, so I don't think it can explain the volatility we saw.
  
  The WMP is new, but its to recent and how could it affect European banks more then Chinese?
  
  I'm convinced that the volatility we saw was related to Deutsche Bank and Credit Swiss situation.
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- Steve Hurst Mar 9, 2016
  
  @Jose
  http://uk.businessinsider.com/fitch-warns-on-chinese-wealth-management-2016-3
  
  http://bruegel.org/2015/12/non-performing-loans-in-italy-and-selected-european-countries/
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Jerry hough Mar 9, 2016

So far as I can tell, the market believes with Paul Krugman that Trump is the ideal candidate because Clinton and Wall Street can beat him easily.

I have taught the courses on the US presidency at Duke University for 20 years. I sometimes am right in my predictions and sometimes wrong, but this time I strongly believe that Trump is a quite heavy favorite to defeat Hillary. When Wall Street realizes this, there should be a real reaction, negative in the short run.

Trump is a New Dealer, and the base of the Republican Party is the lower and middle income white. They are voting overwhelmingly for the New Deal they have always wanted. And for the first time in my lifetime, we have a likely President who is willing to use anti-Semitism against Wall Street, the Fed, and the Netanyahu lobby and its Mideast policy. His voters will eat it up and it will really overcome resistance to his anti-Wall Street policy.

Another New Dealer has been gaining ground rapidly in the Democratic Party and now is carrying a small majority of whites. He is losing the uneducated blacks in the South who are voting against their economic interests., but he carried one-thiird of the blacks of Michigan. That percentage should rise. Nevertheless, unless Obama indicts her, the Southern blacks should give Hillary the delegates to win.

A large number of Bernie voters will vote for Trump, including intellectuals who want to open up the 2020 Democratic primary. I think Trump may get 20% of blacks in swing states and induce huge numbers not to vote. I think he will do reasonably well among Hispanics.

But there is a real chance that when Trump is President he will go the Theodore Roosevelt route in 2012 of creating a new party that will unite the low and middle income whites and minorities (and finally end black-white racial divides.) He is going to go head to head against those like Ryan and something will break. I don't think it will be Trump.

There is a reason for the recent futile meeting of "millionaires and billionaires" to quote right-wing talk hosts to stop Trump. It included heads of Google, Facebook, Apple, etc. They realize that he will really go after a limitation of immigration, although with amnesty. He will go after foreign earnings, buybacks, etc., on which the market bubble has rested. He will raise wages. In the long run it will be good for demand, but in the short run it should produce a Shiller-like adjustment in the market. Or so I think.

The market has a lot to think about.
- Jose araujo Mar 9, 2016
  
  Sir, you are insulting the New Deal and the intelligence of many, by making absurd comparisons.
  
  After reading your post, I wouldn't be surprised if you were a Trump supporter, such is low level of your ideas and the degree of your illusion.
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Steve Hurst Mar 9, 2016

In short - The world has run out of consumers
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