Mohamed El-Erian Quotes

Greece's debts are all denominated in euros, but it isn't clear who holds how much of those debts. For that reason, the consequences of a national bankruptcy would be incalculable. Greece is just as systemically important as a major bank.

For the next three years, we're going to see different economies work out different problems. For European economies, especially Greece, it would be through default.

On any measure, Spain's bank rescue has been a disaster. A hundred million euros have been added to the national debt, ten-year bonds are at a record high and the country's credit rating has been downgraded three notches.

It is simply science fiction fantasy to say that, if you do not raise the debt ceiling, that everything is going to collapse.

One needs a comprehensive concept that decides just how much debt states like Greece, Ireland, Portugal, Spain and Italy can sustainably bear.

The moment a large investor doesn't believe a government will pay back its debt when it says it will, a crisis of confidence could develop. Investors have scant patience for the years of good governance - politically fraught fiscal restructuring, austerity and debt rescheduling - it takes to defuse a sovereign-debt crisis.

Italy even in the future will not need aid from the European Financial Stability Fund.

I want to see an end to sovereign risk questions over Australia.

If Spain goes under, Italy will come under even more scrutiny.

The once-unthinkable loss of the AAA rating will constitute a further hit to already fragile business and consumer confidence.

Greece's debt is going to be a function of a lot of factors down the road.

Here's the perversity of Wall Street's psychology: The more Wall Street is convinced that Washington will act rationally and raise the debt ceiling, most likely at the 11th hour, the less pressure there will be on lawmakers to reach an agreement. That will make it more likely a deal isn't reached.

So you know, everyone points out Greece's default record, but the history of a lot of sovereign nations is not a good one when it comes to lending them money.

From my point of view it's impossible to cut debt in a country with new debt from another country.

Defaulting on the nation's debt would be cataclysmic. The U.S. Treasury's Aaa rating is the one constant in the world's financial system. When times are bad anywhere on the planet, global investors flock to Treasury bonds because they know they will get their money back.

You could have another downgrade. You could certainly have a stock market reaction that would be negative. And, I think nobody who looks at it objectively would want to happen.

Markets themselves are looking for stability, and I think we have underestimated the capacity of Europe... to actually create a more stable framework for the whole issue of debt management, bonds, and so on.

After everyone has had a chance to bluster, posture, and pontificate, we are left with one basic question: under any foreseeable circumstance, would it be in our national interest to default on our debt? The answer is unequivocally no.

I think there will be no government bankruptcy in Greece.

I don't know of any of us that want to see any kind of default happen.

How much would you pay to avoid a second Depression?

There was no avoiding the fact that we were going to hit our debt ceiling.

America's downgrade may serve as a wakeup call for its policymakers. It is an unambiguous and loud signal of the country's eroding economic strength and global standing. It renders urgent the need to regain the initiative through better economic policymaking and more coherent governance.

Well what would happen is that if Greece defaulted and couldn't pay its debts, all the Greek bonds that are held in other banking systems across Western Europe would suddenly have no value. You could as a knock-on effect create a banking crisis in Western Europe.

Spain is finding it very difficult to finance itself with sovereign debt risk premium so high.