Obama’s Favorite Economist Won’t Get Top Advisor Job

On the most recent episode of “60 Minutes”, President Barack Obama spoke of the term the “New Normal”, created by his favorite economist, PIMCO’s Mohamed El-Erian. The incredibly undeserving term, describing a world economy where growth is slowing,  investment and returns are lowering, and historical returns are few and far between, got another boost of attention. PIMCO, the world’s largest bond investor with over $1 trillion of assets under management as of 2010, is big – yes – and El-Erian is in charge. But Insider Monkey thinks this term may just have been a spur-of-the-moment TV quip that turned into a sensation.

Barack Obama serious

El-Erian coined the term back in April, 2009 on an interview on CNBC. The hoopla that followed far exceeded what new wall street slang usually gets. Three months later, Bill Gross predicted that all asset classes would return 4-5% per year during the magic “New Normal” phase.

The new normal will not be investor-friendly unless your forecasting dial is turned to “Pollyanna” or your intelligence quotient is significantly less than 100,”he said. The truth is, the S&P 500 returned more than 39% since then… but Gross and El-Erian still talk about the “new normal” and “low asset returns”.  (See the details of New Normal Nonsense)

To boot, even El-Erian admits that the probability of the New Normal becoming reality is only at 55%. Yet he remains so vocal about it. Now the government’s bigwigs are listening in on this nonsense. Barack Obama not only listens to what El-Erian says, but has been using El-Erian’s rhetoric and terms to justify the Quantitative Easing 2 program to the Chinese and German critics.

There were rumors a couple of months ago that Obama is considering El-Erian as Larry Summers’ replacement. Considering Obama’s new-found love affair with the terms “new normal” and “global imbalances,” this isn’t surprising. But Insider Monkey doesn’t believe Obama will appoint his favorite economist to the top economic advisor position. Why? El-Erian’s first name is Mohamed. Not the right reason, but reason enough for too many.

Comments
Insider Monkey Small Cap Strategy
Insider Monkey Small Cap Strategy

Insider Monkey beat the market by 52 percentage points in 24 months. Our beta is only 1.2 (don't click this link if beating the market isn't important to you).

Lists

The 10 Largest Pharmaceutical Companies In the World

The 10 Most Expensive Android Apps

The 9 Most Expensive Designer Bags in the World

The 7 Most Expensive Real Estate in the World

The 10 Most Expensive eBay Items Ever Sold

The 10 Most Expensive iPhone Apps

The 9 Most Expensive Designer Shoes in the World

The 10 Most Expensive Cigarette Brands

The 10 Most Expensive Law Schools in the US

The 10 Best Wall Street Movies

The 10 Most Expensive Golf Clubs Ever Sold

The 10 Most Expensive Golf Memberships

The 10 Best Disney Characters Ever Created

The 8 Best Foods for Gaining Weight

The 10 Most Expensive Colleges in the World

The 7 Most Memorable Ad Campaigns of All Time

The 7 Most Expensive High Schools in the World

The 10 Electric Vehicles with the Longest Range

The 10 Cities with the Worst Drivers in the World

The 10 Most Expensive Dresses Ever Created

10 Islands to Visit Before You Die

10 Famous Celebrities Who Needed Rehab

The 15 Countries with the Largest Oil Reserves

The 10 Most Overused Excuses in the World

The 5 Best iOS Apps You Can’t Get on Android

5 Companies Damaged By Social Media Blunders

The 10 Most Legendary Blues Songs

The 10 Most Lawless Places in the World

4 Reasons China is a Threat to the US

The 17 Most Sugary Drinks in the World

The 10 Most Ruthless Rulers in History

The 10 Greatest Generals in History

Top 8 Travel Destinations for 2015

The 10 Safest Dog Breeds for Children

The 10 Most Stolen Vehicles in the US

The 7 Most Expensive Celebrity Weddings

The 10 Best LoL Teams in the World

Top 10 Worst Marketing Campaigns Ever Produced

Top 5 Diets that Help You Lose Weight

The 10 Best Ways to Stay Awake

7 Artists That Switched Musical Genres

The 10 Most Expensive Cities to Live in New Jersey

The 10 Best High Schools in New York

The 10 Countries With the Least Gender Inequality

The 6 Biggest Musician-Manager Feuds

The 10 Countries with the Cheapest Gas Prices

The 7 Most Theatrical Bands of All Time

The 8 Worst Band Breakups of All Time

The 10 Most Important South American Leaders

The 7 Most Successful Casting Show Winners

Subscribe

Enter your email:

Delivered by FeedBurner

X

Thanks! An email with instructions is sent to !

Your email already exists in our database. Click here to go to your subscriptions

Insider Monkey returned 47.6% in its first year! Wondering How?

Download a complete edition of our newsletter for free!