Big Mac at the Second Window?
In his October Investment Outlook, PIMCO's Bill Gross offers a helpful analogy to understand today's credit markets:
"Credit markets are based on trust and when there is no trust, markets can freeze up. My Co-CIO Mohamed El-Eiran has a great everyday example. Imagine yourself at the drive-thru ordering a Big Mac. At one window you order and pay, at the other -- 20 feet ahead -- you pick up your lunch. What if you thought that after paying at the first window, your 1000 calorie sandwich might not be waiting for you a few seconds later. You might not pay; business as usual might not take place. That is what is happening in the credit markets. They are frozen in 'McFear.'"
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