Investors should be paying more attention to the uncertainty being created by the turmoil in Ukraine and the Mideast, Mohamed El-Erian told CNBC on Monday.
The financial markets believe the two crises are containable, but that might fleeting, the former Pimco co-CEO said in a "Squawk Box" interview.
As the world piles pressure on Russian President Vladimir Putin over Moscow's possible role in the downing of Malaysia Airlines Flight MH17, the U.N. Security Council is expected to vote Monday on a resolution demanding international access to the crash site in eastern Ukraine crash.
Read MoreLive Blog: Latest developments on MH17
In the Mideast, Israeli ground forces advanced into Gaza's most densely populated city in the deadliest day of fighting for both sides since the conflict began two weeks ago. Secretary of State John Kerry is headed to Cairo to push for a cease-fire.
Even if there are spillover effects from these events, El-Erian said, the consensus on Wall Street says it doesn't matter—earnings are strong and the Federal Reserve is still supporting stocks.
He warned there's "notable complacency" among traders, but that complacency has been rewarded because many of the recent geopolitical crises have proved to be buying opportunities. "Because the Fed is standing by the markets, there's [been] a reason to fade any sell off."
Read MoreWhy investors can still count on the Fed: El-Erian
"But the problem is if you step back the process is getting worse. It involves nonstate actors, which means it's much harder to contain," he said. "Unlike the old days, there is no outside power that inform, influence, or impose outcomes."
The Israel-Hamas conflict also risks "radicalizing people around the region," El-Erian said. "The minute you start talking about [that], you bring in Iraq, you bring in Syria, you bring in other countries."
—By CNBC's Matthew J. Belvedere