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November 15, 2011 at 07:25 AM
Franklin Templeton Investments’ Mark Mobius says Europe’s debt crisis won’t push the global economy into a recession because liquidity provided by central banks is fueling underlying demand.
“We just don’t see any cause for alarm in the sense of things completely drying up and there being a situation where nobody buys anything,” Mobius told Bloomberg from Taipei on Nov. 10. “We don’t see a let-up in demand. Governments around the world continue to pump money into the system and interest rates are low.”
Despite continued economic worries over Europe in general and recent leadership changes in Italy and Greece, Mobius, who oversees more than $40 billion in assets as executive chairman of Templeton Emerging Markets Group, told the news service that Europe won’t “drag everyone down” into a recession and that the outlook is for a world economy “puttering along” at a slow pace of growth.
“We have not been very, very concerned about the situation in Europe,” Mobius said. “The markets of course will go haywire. Volatility is with us and will increase as we go forward, both up and down.”
With the average price-to-earnings ratios of stocks in emerging markets at “near their all-time lows,” Bloomberg reports Mobius is finding “great opportunities” to buy stocks, especially in Brazil, Russia and Turkey. In Thailand he said he’s “lying in wait” to buy if valuations fall.
