(UCLA Anderson Dean Judy Olian on stage with CNBC's Brian Sullivan, BlackRock's Larry Fink and PIMCO's Bill Gross. Photo by Aaron Schasse.)
Don’t believe the hype.
Instead, believe Larry Fink (’76), founder, chairman and CEO of BlackRock, and Bill Gross (’71), founder and co-chief investment officer of PIMCO, who believe – despite rumblings to the contrary – that the U.S. will not default on its debts.
The two UCLA Anderson alumni and titans of the financial industry made the claim in a conversational summit dubbed “A Meeting of Extraordinary Minds” held at The Beverly Hilton Hotel tonight. Their discussion was moderated by Brian Sullivan of CNBC.
“The United States is the standard bearer of the world,” Fink said. “People look to the United States as a country that lives by principles, and just the notion and just the conversation of a potential default is just unacceptable."
“This narrative should not be part of our consciousness,” Fink said. “Every country in the world looks up to this country, and because of the position we were in, we were allowed to borrow and everyone believed our work was our bond. The conversation (regarding the possibility of a U.S. default) will have a psychological change in how (other countries) look at the United States. When I travel and meet with leaders from other countries, I hear a profound sadness."
“Really, there’s no possibility of debt default,” Gross said. “The conversation, it’s political. It’s not a realistic message and (default) is not a possibility whatsoever.”
The conversation covered a wide range of topics, including the pair’s bullish enthusiasm for investment in Mexico and the nation’s education crisis. Fink discussed the “death of long-termism." Gross concurred, also commenting on the impact of low interest rates.
“We live in a world with artificially depressed interest rates that lead to artificially depressed returns [on investment]. CEOs don’t want to invest for the long term,” Gross said.
To view the entire conversation, please click here.
Follow the converation on Twitter at @UCLAAnderson, #finkgross