Investment masterclass: what’s one of the world’s leading investors buying?
Oct 10, 2023
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Mohamed El-Erian, renowned economist and investor, talks about his wait-and-see approach to equities and investment strategies during high inflation. He also reveals solutions to world problems from his book "Permacrisis." He explains how a telling-off from his daughter led him to quit a top job. The podcast covers topics like interest rates, changing financial markets, saving, and the impact of inflation.
Dr. Elarian predicts that the last mile of taming inflation will be the toughest, requiring higher sustained interest rates.
The book 'Perma Crisis' proposes solutions for global economic failures, emphasizing technological revolutions and enhanced global cooperation.
Deep dives
The Future of Watches: Smart Wearables and Traditional Watches can Coexist
In this podcast episode, the future of watches is explored. Andrea Zimmer, head of products for Huawei Europe, discusses the potential for smart wearables, stating that although the current penetration is around 50%, there is still a lot of room for growth. Francois Henri Benemiers, CEO of Audumar Piguet, shares a similar sentiment, emphasizing that smart and traditional watches can coexist and complement each other. Psychologist Dr. Ruth Oldton adds to the discussion by highlighting the pressures that not only come from humans but also from technology. This episode delves into the evolving landscape of watches and the possibilities for the industry.
The New Normal: Higher Interest Rates and Sticky Inflation
In this investment masterclass, Dr. Mohamed Elarian, a renowned global economist and former chief executive of Alliance, predicts that the last mile of the journey to tame inflation will be the toughest. He explains that inflation is likely to be sticky, requiring higher interest rates to be sustained. This new normal in the economic landscape means that investors need to adapt their strategies accordingly. Dr. Elarian advises investors to be honest with themselves and differentiate between recoverable and non-recoverable investment mistakes. Building resilience, embracing optionality, and being agile are key for navigating this challenging environment.
Fixing a Fractured World: Solutions for Global Challenges
Dr. Mohamed Elarian, along with former British Prime Minister Gordon Brown and economist Professor Michael Spence, co-authored the book 'Perma Crisis: A Plan to Fix a Fractured World.' They discuss the failures in the global economy, such as lack of sustainable growth, repeated policy mistakes, and insufficient global collaboration. The book proposes solutions by leveraging technological revolutions in AI, life sciences, and energy transition to drive inclusive and sustainable growth. It also emphasizes the need for policy coordination and enhanced global cooperation. Dr. Elarian highlights the challenges ahead and urges individuals to choose resilience, optionality, and agility to navigate the evolving economic landscape.
The renowned economist and investor Mohamed El-Erian is chief economic adviser at Allianz, the parent company of Pimco, one of the world's leading providers of bonds and fixed-income investments. He’s also a contributing editor at the Financial Times, but his smiling byline photo on his weekly columns about the global economy is often at odds with the warnings and predictions he makes. He tells host Claer Barrett why he’s taking a wait-and-see approach to equities and gives his take on investment strategies in a high-inflation environment. Revealing some of the solutions to world problems in his latest book, Permacrisis, he also explains how a telling-off from his daughter was behind his decision to quit a top job.
The Money Clinic podcast is a general discussion around financial topics and does not constitute an investment recommendation or individual financial advice. For that, you'll need to find an independent financial adviser.
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For the FT’s review of Mohamed El-Erian’s book, Permacrisis, see here
If you would like to talk to Claer about a future episode, please email the Money Clinic team at money@ft.com with a short description of your problem, and how you would like us to help.
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Presented by Claer Barrett. Produced by Philippa Goodrich. Our executive producer is Manuela Saragosa. Sound design is by Breen Turner, with original music from Metaphor Music.