As we have learned repeatedly through a century of cycles already, faith in central bank magic is misplaced and devastating in the end. Their interventions have made this cycle the most extreme ever, and asset prices that are inflated beyond reason are set up to deflate equal and opposite in the other direction. We must make our own financial decisions accordingly.
Mohamed El-Erian, Allianz chief economic advisor, discusses the current state of the markets and central bank policy. Here is a direct video link.
Mohamed El-Erian: You need a major shock to dislodge this market from CNBC.