Pacific Investment Management: The next global recession is a good time to grab deals

Daniel Evaskin, chief investment officer at Pacific Investment Management, said that as central bankers get ready to keep rising interest rates, the next global recession will be a good opportunity to buy deals. He added that his business anticipates a "harder downturn" for the world economy. In an interview with the Financial Times, Evaskin added: "Monetary policy officials feel the need to implement more monetary tightening, the more monetary tightening they feel. increased danger from the more harsh economic outlook and increased uncertainty regarding the impacts' delayed start. The "basic rule" at the time, he noted, was that when interest rates increased last year, they would take five or six quarters to take effect. He also claimed that the market might yet be in for a surprise.

Good time to grab deals

Although Pimco believes that a “soft landing” is the most likely outcome for the US economy; Evaskin told the newspaper that the world's largest active bond fund manager is avoiding areas of the market that would be most vulnerable in the event of a recession.

Pimco, which is owned by Germany's Allianz, prefers high-quality government and corporate bonds for now. It is also awaiting downgrades of corporate credit ratings, which Evaskin said would lead to the forced sale of assets such as collateralised loan obligations in the coming months and years. Adding - in his statements to the "Financial Times" - that this is the right time to seize deals.

Evasin warned that this monetary tightening cycle may be different from previous cycles, and continued in his interview that central banks may be less willing to provide support, for fear of fueling higher prices.Although the fact that much of the risk has been transferred to the private markets should slow the deterioration of credit ratings;But it won't stop him