Bear Case for Crisis Round II Is Wrong: Strategist
Fears of a second round of the financial crisis are misplaced and investors shouldn't bank on another tranche of quantitative easing from the Federal Reserve, Guy Monson, managing partner & CIO at Sarasin & Partners, told CNBC Thursday.
"The bear case: we're in the eye of the credit storm now. Half of it has passed across us, we're in the calm bit and it's about to be unleashed again," Monson said describing a worst-case scenario for the economy.
The key factors that bearish investors believe could cause the crisis to return are: further commercial real estate losses in the U.S. and another round of crisis in Europe, according to Monson.
"I think that the core fundamentals for the Europe are actually quite good, that the deficit numbers for the euro zone are actually lower in total than Japan or the U.S. So I don't think that's going to happen," he said.
Monson also doesn't believe that the outlook for U.S. commercial real estate is as bad as some are predicting.
Banks are going to start to release distressed commercial real estate assets and some traders and active property managers are "going to get in there are actually start to make some money," he said.
"If of course there was a slip up or a crisis of some sort QE3 comes in, but I'm not banking on it," Monson added.