Friday, February 11, 2011

Below is reaction from several analysts and economists to Egyptian President Hosni Mubarak’s speech Thursday evening.

Alanoud al-Sharek, Senior Fellow,
Regional Politics, International Institute For Strategic Studies – Middle East
“He doesn’t seem to understand the magnitude of what is happening in Egypt. At this point I don’t think it will suffice. He still seems to think he is the top patriarch and custodian of the Egyptian people.

He doesn’t realize that there is a genuine act of resistance taking place. He has performed quite a sleight of hand. He has transferred authority to Omar Suleiman while somehow retaining his position as ruler.
It’s a very strange maneuver. And he sheds responsibility for any of the negative things that have happened.”

Stephen Schork, Editor,
The Schork Report, Villanova,
Pennsylvania
“The market did not react to news from Egypt. We were up a bit in post settlement trading but I think that is more on technicals. The market is confused now. Given how much weakness we saw last week, I expect prices to move higher.”

Matt Smith, Analysts, Summit Energy, Louisville, Kentucky
“We’re putting a premium back on oil prices because of continued uncertainty in Egypt. Many people expected Mubarak to resign and he didn’t.”

Richard Ilcyszyn, Senior Market Strategist at Lind-Waldock, Chicago
“It was a bit of a surprise for us and the market. Oil markets are going to respond to the upside. It is now a lingering debate. Any instability in the Middle East means higher prices in oil.”

Bill O’Grady, Chief Investment Strategist, Confluence Investment Management, St. Louis, Missouri
“Oil and equities market are choppy after the non-announcement by President Hosni Mubarak. We don’t know what to do with this announcement. I think we may be on the cusp of a coup d’etat since the military and the civilians are not on the same page as the government.

“The younger military really want to see this guy go and they are allied with the protesters. The older military don’t want to give up power just yet and want to play a role in the orderly transition of power. This is playing out a lot like the situation with Anwar Sadat.

“This has got to have the Saudis all hacked off, since the U.S. administration is not likely to do anything except dump a guy when sentiment goes against him. The Saudis are likely seeing a replay of Jimmy Carter and they don’t like it.”

Peter Beutel, President,
Cameron Hanover,
New Canaan, Connecticut
“[Mubarak’s] speech did not do anything to assuage those who are in opposition to him. Analysts expect the protests to continue.
“The great fear of the oil market is that violence and protests which seem likely to intensify after the speech may be transferred to other parts of the oil rich Middle East.”

Mohammad El-Erian,
Co-Chief Investment Officer, Pacific Investment
Management Co.
“By falling far short of what millions of Egyptians are looking for, the president’s speech will fuel enormous popular anger.

Given the intense disappointment with the speech in Egypt, the country has entered this evening an ominous period of extreme tension and danger that can only be resolved by credible regime change that the majority of Egyptians can buy into.”

Steven Cook,
Middle East Analyst,
Council of Foreign Relations,
New York
“We have seen today some movement but nevertheless Hosni Mubarak appears defiant to the end.”

John Sfakianakis,

Economist, Banque Saudi Fransi

“Markets are going to see this and run away. They will look at this and say ‘where did we go wrong?’
“It just makes it more confusing and unpredictable than ever before. Unpredictability is the thing foreign investors hate, along with political instability, and this is really the epitome of both of theses elements.

“I think that international investors will brace for the worst, because they will now begin to expect a severe deterioration of the political situation, which means the currency is going get pounded, the stock market will get pounded, and they will leave Egypt en masse.

“There seems to be a gap between what society wants and what the president is delivering, and the two together are a destructive mix, and investors would not to see nor participate in a country that has this.” – Reuters