The Global Agenda

Global trade and investment imbalances and their impact on foreign exchange and bond markets will also be a key focus at the Forum. Rich Clarida has pointed out that global imbalances, typified by the informal Bretton Woods II arrangement, continue to be among the most pressing issues for investors.  

The Forum’s global agenda will also include discussion about how the U.S. economic slowdown is impacting other economies. After the September Cyclical Forum, Scott Mather said that while European growth has been strong, a pullback in U.S. growth combined with tighter euro zone monetary policy will likely create headwinds for both the U.K. and euro zone economies. Slower growth and revised inflation figures in Japan, meanwhile, are forcing a moderation in expectations for the Bank of Japan’s monetary policy normalization, as Bill Powers has pointed out.

The Cyclical Forum will also include a look at how emerging markets are faring amid the U.S. slowdown and retreat in oil and commodity prices. Michael Gomez says that improving fundamentals in some countries like Mexico, Brazil and Russia make them far better equipped to deal with a global slowdown in the current cycle than in the past. 

Meanwhile, across all economies and markets, participants are likely to continue the dialog about investing in a world where rewards for taking risk are unappealingly low. Bill Gross recently expressed concern that asset prices may soon be struggling to even keep up with nominal gross domestic product, and that investors should look carefully for strategies that will be least harmed by a surge of risk aversion. 

These are only a few of the topics PIMCO will discuss at the December Cyclical Forum. Check PIMCO.com in December for an interview with Paul McCulley discussing the key conclusions from the Forum, which will be followed by an interview with Bill Powers discussing the details of PIMCO’s global investment strategy (or click here to be alerted when these Spotlight interviews are published).