Complacency has been encouraged and will be punished

Complacency and aggressive risk taking has been intentionally encouraged by Central Bank policies the past 4 years. But since the Fed is only bluffing that it has control, reality will eventually hit as a dramatic shock and punishment to followers.

Investors should be paying more attention to the uncertainty being created by the turmoil in Ukraine and the Mideast, Mohamed El-Erian told CNBC on Monday.

“Because the Fed is standing by the markets, there’s [been] a reason to fade any sell off.”

“But the problem is if you step back the process is getting worse. It involves nonstate actors, which means it’s much harder to contain,” he said. “Unlike the old days, there is no outside power that inform, influence, or impose outcomes.” Here is a direct video link.

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