Mohamed El-Erian, President and Co-Chief of the PIMCO investment, is interviewed on the 2011 the Milken Institute Global Conference in Beverly Hills, California on May 2, 2011.
Credit: Reuters/Fred ProuserWASHINGTON. Sun June 26, 2011 12: 00 am EDT
WASHINGTON (Reuters) - sovereign of the Greece the debt restructuring is inevitable, investment officer PIMCO Co-Chief Mohamed El-Erian said Sunday, warning the problems the nation could "contaminate" Europe.
"It is inevitable that the Greece will have to restructure its debt." "Europe has been kicking can, on the road, address the problem of the Greece not as a problem of solvency, but as a problem of liquidity," he said on "fareed zakaria gps" program of CNN.
The Greece is at the edge by the defaulting on its huge public debt. The Government is seeking parliamentary approval for an unpopular set of austerity measures demanded by the European Union and the Monetary Fund International to release a cruelly slice of a loan of 12 billion euros ($17.2 billion).
The Greek Parliament is due to savings of EUR 22 billion for 2012-2015 reduce deficits and keep qualifying EU - IMF and voting Wednesday and Thursday on measures that include 6.5 billions of euros of austerity measures additional to this year.
It also accelerated the sale of State assets under a program of privatization of EUR 50 billion.
"The Greece has too much debt and cannot grow until these problems are resolved." More Europe will be contaminated, "said El-Erian, who helps oversee 1.1 billion of dollars in assets to PIMCO, the world biggest Bond Fund Manager."
While the public finances at the United States crack, El-Erian said that the country was fundamentally different from the Greece, adding that he had much more time to deal with its fiscal policy issues.
"It feeds the dollar as reserve currency, it provides deeper financial markets, which means that other countries were willing to outsource their economies," said.
PIMCO remains bearish on the U.S. government debt. El-Erian said that PIMCO found the best value in treasuries outside the United States.
"It is a question of the assessment." U.S. bonds have benefited enormously from the reserve Federal purchase then program (quantitative easing) of2, which terminates at the end of June, "he says.
"So when we look at the Treasury bills, see us the large buyer stepping away from the market and ask who else is going to be buying at these levels, and we cannot identify another purchaser of the size of the Fed."
El-Erian said that the market has underestimated the impact of the end of $ 600 billion to buy bonds the Fed Government program, which aimed to stimulate the economy by lowering interest rates.
(Reporting by Lucia Mutikani; editing by Jeffrey Benkoe)
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