El-Erian Says US Stagflation Is 'Unavoidable'

Mohamed El-Erian, chief economic advisor at Allianz and Bloomberg Opinion columnist, says markets have not yet priced in a significant slowdown in growth as he sees stagflation "unavoidable" for the US economy. He speaks with Francine Lacqua on "Bloomberg Surveillance Early Edition." His opinions are his own.

[@10783247jp]

The slow grind into depression.

[@RealFahimReza]

Its probably already here, they first said no inflation, then it was transitory, now people are worried they won't be able to bring it down

[@10783247jp]

@@RealFahimReza seems to be the case. It’s gone from high growth, to lower growth, to definitely stagflation and now recession risks building. The momentum is definitely to the down side.

[@richardhales92]

@@10783247jp seems to be on the downside

[@lawrenceleverton7426]

Load up that Credit Card Debt. Maybe Brandon will cancel that as well. Lets Go Brandon

[@dilibau]

She actually said "you've been bangin' on" 🤣🤣🤣

[@kelvinmagoon]

The employment shortage is really due to the "Why work, when your house makes more than you!" sentiment. No way to get off the coming train wreck, so better just sit tight and brace for it.

[@MrSupernova111]

Interesting point of view. I wonder how many people used their home as piggy banks. I know at least one couple that sold their home at recent prices to move into an apartment.

[@WiseOwl_1408]

@@MrSupernova111 it's a great idea but I'd rather not move my family.

[@alexanderharo4550]

-subversive hater

[@MrSupernova111]

@@WiseOwl_1408 . While I think the idea sounds great on paper there is certainly the risk that prices don't come down enough to justify the inconvenience and expense. Anyway, good food for thought. Cheers!

[@kelvinmagoon]

@@MrSupernova111 Last year there was a two year waiting list for $80k+ swimming pools. If you couldn't travel, and your home appreciated 30%.... well what to do with all this extra "cash" laying around. Last year was also the first year you could sell a used boat for MORE than you paid for it 10 years ago. Insanity. Everybody knew this was coming. Get ready for a news cycle of "buyers remorse" stories. Banks are quiet on the data, but one release I found in Canada says there was a 70% increase in Helocs during the pandemic. So the "possibility of too much QE" might be an understatement.

[@sodbuster7776]

Happy times are here again.

[@alesh2275]

Japan wasn’t in Stagflation precisely because Japan didn’t have inflation. Japan was in disinflation, i.e. inflation that wouldn’t budge to between 0.01% to 0.90% a year. This is despite the world’s biggest QE program trying to get inflation to 2%. Maybe for Japan you’d need to invent a new term “Stagdeflation”

[@edmundlively8137]

During the late '80s Japan had gigantic inflation of real estate prices.

[@anonymousAJ]

Japan had massive dilution but with development -> mild depreciation -> what happens when the development tapers off?

[@allansta0202]

Yeah I agree. For the lost decade in Japan, I think is deflation. That’s why they try to simulate the economy by expansive monetary policy during the Abe Administration (2nd term, to be precise). I could be wrong lol

[@jzplayinggame]

This guy is bearish all the time. So in other words even a broken clock is right twice a day

[@illegalsmirf]

Be vewy, vewy afwaid.

[@rackem6724]

What a shill, yesterday he said that recession is unlikely.

[@jlvandat69]

El-Erian has been spot-on with his views on the economy and opinions as to "appropriate" FED policy for at least two years. However, is very careful with his words since he fully appreciates that new developments can quickly alter his prognostications. Example, when he says, "The FED will need a lot of luck" (to execute a soft landing), what I hear is, "There's a very low probability the FED can prevent (at least) a mild recession". Given the number of significant global supply chain constrictions (both current and probable), my base case is for much higher interest rates than currently estimated and a genuine recession albeit many months from now.

[@danielhutchinson6604]

September seems to be the announced cut off date for Russian Resources..... That seems to indicate the approximate time for the deterioration of price and supply structures to go completely to hell? We shall see how the European Leaders deal with the concept? Russia seems to contribute a vast amount of Commodities from Gas to Grain, and even the London Metal Exchange had to cancel a full days orders after they discovered they were unable to fill orders without Russian Stainless Steel. Respect for the Russian part in providing commodities has become some ingredient that seems to clash with the Project for the New American Century? Victoria Neulands War seems to be doing as poorly as Hitlers attempt at exploiting Russian Resources? A couple months and the Feces shell enter the fan blades, unless major shifts in US Foreign Policy become apparent? Propaganda only buys a cup of Coffee..... Food seems to be extra?

[@jlvandat69]

@@danielhutchinson6604 In general, my opinion is that very few people fully appreciate the extent to which Russia has contributed to global supplies. Those supplies are going offline for a considerable length of time- at least until the current regime in Moscow is changed out. Ukraine also contributes much and those supplies will be minimal for at least a year. I see no way out of a global recession.

[@letsdanceonhere]

@JeffV I don’t know about “spot on” because he was very wrong in 2020 and most of 2021. However, I regretfully agree with him now and he probably has been “spot on” for the last 8 months.

[@jlvandat69]

@@letsdanceonhere I have followed him fairly close for 3 years- he was positive on equities in 2020 post-March, and basically stayed that way until about mid-2021 when he grew increasingly concerned about FED policy/inflation. I wen to 80% cash in Nov-Dec that year partially based on his increasing concerns and thereby avoided the big downdraft in january and beyond. Speaking for my self, Mr. El-Erian has been exceptionally helpful.

[@richardhales92]

Look at YESTERDAY'S El-Erian video on CNBC; he says the "possibility of a recession is very low". "Today, stagflation is a certainty" Like most of us, El-Erian maybe just guessing the outcome. What happened with his views in last night's sleep? It may be typical, but I wouldn't put my money on anyone's views except your own research when investing and listen to others for their opinions.

[@irishcherokee8884]

Fed is still printing money and buying bonds and hasn’t raised rate 1% .The beginning of the crash is accelerating.

[@jzzzxxx]

Time is the best disinfectant for fear mongering

[@zipengzhou9455]

after one year it turns out to be bull sh*t

[@flyingdutchman1352]

Housing will crash. Sell your house today and buy it back in 2 years for half. Move to the caribbean?

[@1philliph]

Many have failed doing just that. The risk is that you end up homeless

[@cutyouoff7744]

stupid, because inflation will eat up your money from the sell.

[@evanjameson5437]

this is NEWS?? we've been in stagflation for over a year! How much does he make?

[@bradleyqueen3879]

Too much.

[@marsaetos9610]

El Eriani has always been on point without sugarcoating.

[@method341]

Still waiting for that stagflation

[@KozyTapes]

GDP Declination, $9T Balance sheet, QuanTitative Tightening, UltraHigh Gini Index, Asset price bubbling, Ineffective Tax Rate, and Cor*naV

[@TheAldoinMiami]

It needs a lot of lock at this point 😂😂😂😂😂😂😂😂

[@georgemaximus694]

Stagflation means inflation, high unemployment, and slow or stagnant economic growth rates. So he is saying unemployment is going to go up soon right?

[@kolabola7200]

Yes.

[@johndinglebery7983]

Michael Wilson was predicting this since last year.

[@rudeawakening3833]

Economic experts agree - “ ordinary citizens globally need to become their own central banker “ Buy physical gold ; if you can’t afford $1,800.00 an ounce gold - get physical silver . It is ( temporarily ) at $21.00 an ounce , over 50% below its two time high.

[@advantechomeinspectionsllc405]

Not sure if you'll agree but owning crypto is similar to being your own bank as well. Your wallet, your place to store your money, your freedom to send to whomever and purchase whatever(limited now, I will admit) without having to go through a bank. I like gold and silver too for tangible assets.

[@anonymousAJ]

@@advantechomeinspectionsllc405 irredeemable crypto is no better than euros, redeemable is good to try though

[@advantechomeinspectionsllc405]

@@anonymousAJ no clue what you're talking about bud

[@anonymousAJ]

@@advantechomeinspectionsllc405 redemption? One of the basic features of currency? Compare XAUT, PAXG, PGMT

[@markthornton6096]

This was unavoidable. All Fiat systems end this way

[@rz6132]

He has been wrong for entire year. It’s time for him just admitting he was wrong and move on.

[@DiscipleofChrist33]

He just said yesterday that it’s unlikely we’re gonna have a recession.. which hedge fund does he work for?

[@danielmahmoudi6731]

fr you saw that too lol.

[@ssuwandi3240]

He's always a Fixed Income BOND guy! You think slick hedge funder will do Bonds? 😅

[@reneosorio9629]

He is consistent with his recession views. Recession is not the same as stagflation = Low growth AND high inflation IS NOT recession.

[@hadenwesley6548]

No, his message was the same: Today: " is not unavoidable, but the probability is going up...stagflation is unavoidable." Yesterday: "we are unlikely to go into recession unless we get another policy mistake...the risk of recession is there but low, economy is strong, but growth is going down." Then agreed with the reporter quoting previous statements that "a recession is avoidable," which is word-for-word the same here.

[@azrnzala]

i just commented that same thing! yep he totally was just touting the strength of the consumer and no chance of recession yeterday.

[@quantumchem3774]

What is the difference between stagflation and deflation from the household perspective?

[@richardhales92]

Deflation means prices on the things you buy in your household go down; stagflation means prices go up and stays up, for a long period, with jobs hard to find

[@smalltownplaya712]

stagflation means wages stay the same, price of everything else increases.....deflation is when prices of everything come down, including cost of labor ( wages )......America has been in stagflation since the 70's lol......weak wages, prices of everything else go up destroying middle class.

[@richardhales92]

@@smalltownplaya712 It's a dream (doable?) that wages be required to increase like social security every year; takes forever to get minimum wage through legislatures; meanwhile working class, especially at minimum wage, lag in inflation

[@MrSupernova111]

Stagflation is an abomination caused by government policies. Look up how Nixon caused/contributed to stagflation in the 70s.

[@lserranov]

Was him correct or wrong?

[@user-mt4vo4ey5n]

Powell, Biden, Yellen... the best we have to offer, and now you're screwed.

[@audioinsanity]

Here's a copy of the release Analytical Associates sent to media last week: Our Misery Index data shows that in the month of April 2022, the following variables spiked-up: Bankruptcies, First-time unemployment claims, Foreclosures, Evictions, Auto repossessions, Late bill payments including electricity, Store closures, Homelessness, and others. The Analytical Associates Misery Index for April 2022 points to a deep US recession imminently.

[@azrnzala]

he just said the economy was strong and there is low (edit) chance of a recession yesterday. what

[@johnmanier9047]

That was before he went to the store to buy groceries

[@rudeawakening3833]

Not true ; he has held this same view for over a year . You can look it up .

[@richardhales92]

@@johnmanier9047 he went to the supermarket. "this isn't looking good"; back on a diet

[@richardhales92]

how about those eggs

[@eddabraham]

Wrong again, why book these clowns?

[@lostones8512]

When I listen to you all talk now, I wonder how you feel… I often wonder what must be going through all of your minds…. How could someone keep such a straight face when they know that what’s being said isn’t true… It’s sad to watch… What would cause you to continue down this path??

[@nycpark]

damn..

[@1800cc-Dead-Meat]

The art of speaking a lot and saying nothing.

[@advantechomeinspectionsllc405]

Didnt he just say no recession yesterday. Now it's worse? Stagflation?

[@richardhales92]

I'm glad you caught that! CNBC interview YESTERDAY was 'no recession.' Today, el-Erian says stagflation; many commentators on CNBC said yesterday's rise in the market was the break-out point upward; today we're heading down; somehow people need to stay the course, until tomorrow, when, oh, forget what I said yesterday (without specifics). What has changed your mind, in numbers & in charts we can understand

[@advantechomeinspectionsllc405]

@@richardhales92 I'm glad you did too! Let's me know I'm not crazy lol You can't trust any of these guys but you have to watch to get a feel what's going on in the economy. I do like El but we caught the flip flop on this one. Definitely have to screen out the shit when watching these.

[@advantechomeinspectionsllc405]

@@richardhales92 I use to take these guys for face value but learned my lesson.

[@richardhales92]

@@advantechomeinspectionsllc405 i agree w/you. If you do your research, invest and lose your $$, you're not as prone to anger. If you listen to experts, and your stock sinks, anger. They're entertainment, I'm learning

[@richardhales92]

@@advantechomeinspectionsllc405 I don't know why I like El, but I do; today, he used a different soap in the shower; I'll keep him at a distance, like everyone online; incidentally, analysts' price targets for the year are almost never right, even within a big range; we're on our own out here

[@endcronycapitalism1616]

Where is he getting his info on savings rate? Most are broke and putting it on their credit cards... The solution for people wanting to beat stagflation is to not fight the FED... Short everything until they pivot!

[@hmxr715]

I think he’s talking about people who have an investment portfolio of $500k or greater. Obviously that’s not everyone.

[@usazar]

Cries in vulnerable sector

[@nopostonsundays]

He literally predicted yesterday that we would face inflation.

[@jamesrav]

is this the same Allianz he works for? Allianz Global Investors US LLC, a New York City-based investment adviser, has agreed to plead guilty to its role in the fraud and pay $3.2 billion in restitution, a $2.3 billion fine and to forfeit $463 million, prosecutors said in a release.

[@mattdecandia9607]

He's been saying the sky is falling for decades . Also flip flops more than Cramer .

[@rollie5579]

Very true!!

[@titusp9488]

Broken clock is right twice a day ... he is taken as a genius because he gets it right twice a day :P Everyone should be lucky he is NOT the head of FED or ECB. His concept of monetary policy would have driven the US & Global economy into a recession months ago.

[@flyingdutchman1352]

We can't fire either of them. You know why.

[@watersport86]

Maybe the only Keynesian I listen to besides Larry Summers

[@edmundlively8137]

Congress can make it possible for the FED to achieve both objectives if they are willing to stop slowing production by taxing production but prevent inflation by taxing real property, real estate after you tax real property the country still has the same number of acres as before the tax but when you tax production you get less production

[@jerb9254]

Thanks Brandon! 👍🏾

[@chinogixxer7506]

I'm still crying because Trump lost.😂😂

[@thegoodguywins1]

@@chinogixxer7506 And guess whose gonna lose soon 🤣

[@bauttiet.h.u.g.5900]

Is it just me or is there information missing? Why is it too late? What affects does low unemployment have on inflation? How can you have stagflation and not a recession? I kinda think ppl talk about "stagflation" for content. If stagflation doesn't happen or is brief can el Erian come back on and say he over sold stagflation?

[@ESODaily]

Stagflation! This is worse than stagflation, it's contraction 🤦🙄. Seriously, these people are completely clueless

[@webdeuce]

Mo Bond daaa obvious ::))) smh

[@farmerdude3578]

The Feds needs luck? Why? The peoples economy is toast. No problem to them.

[@maharajakal]

Let go Brandon

[@monkeyloven]

Peter Schiff was right again.

[@golds04]

Everyone is a superstar, when they dont have to make the decision. I like him a great deal- but he has switched between bull and bear ? 6 times in 6 months. Why didn’t he go all in short if he knew the fed was making a grave error.

[@srikark3532]

The U.S. needs to keep on innovating in all the sectors and innovation will boost growth. This is why we need to prioritize the private sector and steer policies towards a capitalistic economy.

[@bugsy791]

and widen the wealth gap!!!!

[@srikark3532]

@@bugsy791 Name top 10 innovations from the government sector apart from the military.

[@MrSupernova111]

Keep trying to sound smart while you say nothing. If you want innovation then go start a business. Its easy to sit behind your computer while you demand "innovation."

[@srikark3532]

@@MrSupernova111 I am not demanding innovation from anyone, I am just laying out the facts.

[@MrSupernova111]

@@srikark3532 . What facts? The fact that you repeat whatever garbage you read in a textbook? What you said has nothing to do with the video. At least try to stay on topic.

[@Nimitz_oceo]

This guy is worst than Jim Cramer. He flips everyday

[@rollie5579]

Yes he does

[@rudeawakening3833]

Not really

[@richardhales92]

Alright, here's my latest. Stagflation includes high unemployment; it seems with the great resignation, high unemployment anytime soon seems improbable

[@bilsid]

People will be coming out of retirement when they see their savings invested in stocks and bonds go down and inflation going up

[@richardhales92]

@@bilsid got to be ready for everything when it comes to retirement funds. Best days are just ahead. Make some $$$

[@bilsid]

@@richardhales92 how can you make money out of people going on retirement. don't they withdraw a modest amount and become more frugal and downsize

[@MrSupernova111]

The Great Depression was also "improbable" but it happened.

[@chavruta2000]

totally wrong.

[@nraghu99]

El Erika has been mostly wrong in his predictions and analysis so take it with a spoon of salt

[@billieclark8870]

These guys have zero common sense. The writing is on the wall. World economy is falling apart. Mohamed is so wishy-washy with his analysis.

[@usadaytrader]

This guy is wishy washy af

[@bakurazhu5024]

wrong clown

[@followerofjesuschrist.]

"From that time Jesus began to preach, and to say, Repent: for the kingdom of heaven is at hand." Matthew 4:17,..

[@andresmattos7541]

Thank you Biden voters.

[@wizard7314]

Must be nice to live in such a simple world

[@daleschmitz5832]

@@wizard7314 K.I.S.S. Unfortunately this fiasco is more on the monetary policy rather than fiscal, but for most Biden voters the economy was way down on the list below many of the grievances they had with the previous administration.

[@richardhales92]

@@wizard7314 well, I enjoyed the Reagans, the love between the two clearing brush

[@cheaserceaser]

Biden will fix it. He has done a good. Americans voted for him as POTUS. He's smart, caring, and empathetic.

[@micahalba753]

I can’t tell If you’re being sarcastic or not

[@TheTruthiest]

@@micahalba753 That's what happens when idiots try to be sarcastic

[@kevinpatel8387]

Lolz….

[@MrSupernova111]

Another clueless voter putting all economic responsibility on the POTUS without a clue of how the economy works. Keep at it clown.

[@davelamson2968]

Sarcasm I hope for your sake otherwise you need to be fitted for a straight jacket

[@davidhtate]

Here's a copy of the release Analytical Associates sent to media last week: Our Misery Index data shows that in the month of April 2022, the following variables spiked-up: Bankruptcies, First-time unemployment claims, Foreclosures, Evictions, Auto repossessions, Late bill payments including electricity, Store closures, Homelessness, and others. The Analytical Associates Misery Index for April 2022 points to a deep US recession imminently.