A free-talking El-Erian, Post-Pimco via FT: Tranquil markets underprice geopolitical risk. Markets have been sanguine about geopolitical risk for several years now, a phenomenon illustrated by the relaxed approach they have taken to Ukraine's crisis. There are understandable reasons for this, but contrary to a popular saying, this could well be a case where the trend is not necessarily the markets' friend. After just one day of extreme nervousness, markets have had little problem digesting a major change in the map of eastern Europe. And Crimea's annexation is not the only notable development in a crisis that has repeatedly surprised quite a few experts... Underlying geopolitical tensions around the world have been gradually building towards a tipping point. Should this continue, it would quickly become evident that many markets are underpricing geopolitical risk. Great FT article in full here: (VIEW LINK)