Thursday, February 03, 2011

Egypt unlikely to become an Islamic state

'While the uprising in Iran three decades ago sparked a 140 percent surge in oil and Thailand’s devaluation led to a global equity selloff, Egypt has about 0.3 percent of the world’s crude reserves and its foreign-currency holdings exceed overseas debt by $29 billion. Traxis Partners LP’s Barton Biggs says it’s a mistake to sell shares because of Egypt’s crisis, while Pacific Investment Management Co.’s Mohamed El-Erian sees signs of a “reconciliation” in the most-populous Arab country.

“The one thing to avoid is to exaggerate the probability for chaos,” El-Erian, the son of an Egypt diplomat and chief executive officer at Pimco, which oversees about $1.2 trillion worldwide, said in a Feb. 1 interview on “Bloomberg Surveillance” with Tom Keene. “There’s a lot of talk of ‘what if Egypt becomes Iran?’ I don’t think that’s the case.” '

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