PIMCO.com PIMCO on Facebook
PIMCO.com PIMCO on Twitter
PIMCO.com iPhone/iPad App
PIMCO.com Android App
PIMCO.com Google +1

Insights

  • Investment Outlook
  • Global Central Bank Focus
  • Economic Outlook
  • Global Markets
  • Viewpoints
  • Strategy Spotlight
  • Featured Solutions
  • Equity Focus
  • Experts

Strategies

  • Cash and Short Duration
  • Fixed Income
  • Equity
  • Real Assets
  • Currency
  • Asset Allocation
  • Alternatives

Solutions

  • For Institutions
  • For Individuals
  • For Advisors
  • Advisory Services

Funds

  • Mutual Funds
  • ETFs

Education

Press

  • Broadcasts
  • Press Releases

Our Firm

  • Welcome
  • Overview
  • Leadership
  • History
  • Global Citizenship
  • Global Offices

Careers

PIMCO
Your Global Investment Authority.
  • Contact Us
  • Client Access

Change Country
United States
Australia
Canada
Europe
France
Germany
Italy
Japan
Latin America
Singapore
Spain
Hong Kong
  • Insights
    • Investment Outlook
    • Global Central Bank Focus
    • Economic Outlook
    • Global Markets
    • Viewpoints
    • Strategy Spotlight
    • Featured Solutions
    • Equity Focus
    • Experts
  • Strategies
    • Cash and Short Duration
    • Fixed Income
    • Equity
    • Real Assets
    • Currency
    • Asset Allocation
    • Alternatives
  • Solutions
    • For Institutions
    • For Individuals
    • For Advisors
    • Advisory Services
  • Funds
    • Mutual Funds
    • ETFs
  • Education
  • Press
    • Broadcasts
    • Press Releases
  • Our Firm
    • Welcome
    • Overview
    • Leadership
    • History
    • Global Citizenship
    • Global Offices
  • Careers
PIMCO Search
 
  • Print
  • Email
  1. Home
  2. Insights

Viewpoints

All Viewpoints
  • Print
  • Share
     
    • Email
    • Facebook
    • Google
    • Twitter
     
         
  • Subscribe
     
    • Email Alerts
     
       
Viewpoints
August 2011
Article Title
Why Global Debt Dramas Recur
Article Introduction
  • Most of us wish to put the serious sovereign debt and deficit issues behind us. Unfortunately this is not possible due to continued challenges brought about by ongoing de-levering requirements – especially in peripheral Europe, but also, though less severely, in the U.S.
  • The challenge is, critically, to safely de-lever. The best way to do so is through high levels of economic growth. Yet this option is undermined today by the bumpy journey to a new normal, and is aggravated by the lack of structural policy measures to remove impediments to economic growth.
  • Neither Europe nor America can sustain the sort of economic recovery that would make a meaningful dent in their debt dynamics. As a result, different governments are opting for different approaches, including harsh austerity, financial repression and, in one case, a potential debt restructuring.
  • De-levering pressures will be with us for years, and governments will mix and match from the menu of options. Accordingly, periodic debt dramas will recur. And we all need to understand the dynamics and the likely choices governments will make going forward.
Article Main Body
​Click here to read this article, which was originally published August 1, 2011, on blogs.reuters.com.
Article Disclaimer
​All investments contain risk and may lose value. This material contains the opinions of the author but not necessarily those of PIMCO and such opinions are subject to change without notice. This material has been distributed for informational purposes only and should not be considered as investment advice or a recommendation of any particular security, strategy or investment product. Information contained herein has been obtained from sources believed to be reliable, but not guaranteed.
Mohamed A. El-Erian
Profile | Insights
Past Insights
May 2012
Assessing Possible Greek Contagion
May 2012
Who Is Responsible for the Greek Tragedy?
May 2012
Secular Outlook: Policy Confusions & Inflection Points
 View all Insights by Mohamed A. El-Erian

No part of this material may be reproduced in any form, or referred to in any other publication, without express written permission. Pacific Investment Management Company LLC, 840 Newport Center Drive, Newport Beach, CA 92660, 800-387-4626. ©2012, PIMCO.

  • Legal Disclaimer
  • Privacy Policy
  • Market Data Information

 For PIMCO publication reprint requests please email reprints@pimco.com.

Are you sure you would like to leave?

You are currently running an old version of IE, please upgrade for better performance.