Bloomberg Opinion columnist Mohamed El-Erian and Rick Rieder, chief investment officer of global fixed income at BlackRock, discussed the emerging markets, effects on liquidity and the Federal Reserve on “Bloomberg Markets: The Open.”
Points discussed with El-Erian and Rieder:
- Volatility is docile in the U.S.
- Market slowdowns in China and Europe
- Fed normalizing upon dollar strength
- Financing in this marketplace is getting more difficult
- Massive dispersion in the performance of different market segments
- Emerging markets have a structural imbalance–dedicated vs. crossover flows–causes liquidity issues
- For the active investor, you can pick up cheap assets
- For the passive investor, you get hit by contagion
- Federal Reserve is draining liquidity by issuing debt
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