
(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."
Gross agreed.
“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