“Emerging markets specialist” Mark Mobius, who manages a total of $48 billion for Franklin Templeton Investments says:

  • He sees the possibility of another huge wave of money flowing into global markets
  • As U.S. and European banks start to stabilize and unload high-quality assets that they stockpiled in the wake of the global financial crisis of 2008 and 2009
  • Post 2008, central banks offered to buy riskier loans, and banks invested the cash they received in the highest-quality assets
  • Now banks could look for more profitable investments instead

Mobius notes the new risks:

  • “eventually the money that has been pumped into the banks globally will have to be released. That could be very explosive”
  • Optimistic about emerging markets, there are also potential problems
  • Says central banks could absorb some of the money by selling the riskier assets that they bought up (but so far there is little sign of that happening)
  • Central banks also might start to raise interest rates “It’s really a very sensitive balance that has to be achieved here”

More: (may be gated): Mark Mobius Says a New Wave of Money Could be Unleashed
Investor Says Hard Not to Be Optimistic About Emerging Markets in the Long-Term