Mohamed El-Erian, chief economic adviser at Allianz and Bloomberg Opinion columnist, says a US economic downturn is a “possibility, but not a 100% probability” despite the Federal Reserve’s efforts to meet its “arbitrary” 2% inflation target. “We can avert a recession. And the last few weeks of data suggest that we can still avert a recession,” he says on “Blomberg The Open.”
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El-Erian Says Data Shows US Recession Can Still Be Averted
Mohamed El-Erian, the widely respected economist and Chief Economic Advisor at Allianz, believes that the United States can still avoid a recession despite recent fears and uncertainties in global markets. El-Erian’s analysis is based on recent data that shows positive signs for the US economy.
In a recent interview, El-Erian highlighted several key indicators that point to a resilient US economy. First, he emphasized the strength of the labor market, with low unemployment rates and steady job growth. According to the Bureau of Labor Statistics, the US unemployment rate currently stands at a near record low of 3.5%.
Additionally, El-Erian referenced the robust consumer spending figures as evidence of continued economic growth. The US economy is highly reliant on consumer spending, and so far, American consumers have shown resilience despite the ongoing trade tensions. Retail sales have remained solid, indicating that the purchasing power of consumers is still strong.
Furthermore, El-Erian pointed out the positive conditions in the housing market. Low mortgage rates have been encouraging potential homebuyers, resulting in an uptick in housing sales. This suggests that the US housing market, a critical component of economic growth, is still on solid ground.
However, El-Erian did caution that in order to avoid a recession, certain challenges need to be addressed. One such challenge is the ongoing trade war between the US and China. The trade dispute has led to increased uncertainty and has weighed on business investment and manufacturing activity. El-Erian believes resolving this issue should be a top priority to ensure continued economic growth.
Another concern highlighted by El-Erian is the global economic slowdown. Many countries, including major economies such as Germany and China, are experiencing a deceleration in growth. This external environment poses risks for the US economy, as it could potentially dampen demand for American exports and disrupt supply chains.
Despite these challenges, El-Erian remains cautiously optimistic about the US economy. He believes that the Federal Reserve’s decision to cut interest rates has been a positive move, providing some stimulus to support economic activity. He also stressed that a timely resolution of trade tensions can go a long way in boosting market confidence and revitalizing business investment.
El-Erian’s analysis is in line with recent statements from other prominent economists who believe that a recession in the United States is not imminent. However, they caution that uncertainties persist and the situation can change rapidly, necessitating close monitoring and proactive policy measures.
In conclusion, El-Erian’s assessment suggests that the United States still has the potential to avert a recession based on current data. While challenges remain, the strength of the labor market, consumer spending, and the housing sector provide a foundation for continued growth. Ultimately, addressing issues such as the trade dispute and the global economic slowdown will be crucial in maintaining economic stability and avoiding a recession.
The ability of the BRICS Association of Trading Partners, has been cutting into US Trade deficit figures for about 10 years.
The presence of that competing group appropriating the goods and resources that US Investors have enjoyed for a century, as America treated former Spanish Colonies…..
The US methods were enhanced by the Condor program that continues to force Latin American Citizens to flee oppression.
Recently US Companies are faced with Capitalist Competition from former Communist Nations, and a few that now appear to be working in Markets to overcome the US efforts to exploit weaker Nations.
ElErian must be aware of the Egyptian announcement to participate in the BRICS Currency exchange system, and the Saudi understanding that Russian Oil could remove profits from Oil Markets if dumped freely?
BRICS trade ability appears to avoid mention in media discussions, when they appear to be the biggest obstacle to easy profits?
The US has allowed free exploitation of resources within it's borders, until the profitability was overcome, from easily extracted resources. Communist Nations were not so Liberal with their allowance of exploitation, and now they appear to be holding out on Wall Street Profits? Russia has resources, Nickle, Fertilizer, Oil, and Grain.
The Understanding that Wall Street Greed is the same apparent issue that created the appearance of censure, of Standard Oil a hundred years ago by the US Congress.
The ability to drive competing providers out of business, or buying them out, was what made JD Rockefeller the first US Billionaire.
Russia was providing Fuel to Europe at affordable prices, the US suppliers were incapable of competing, so Russia had to go.
That form of ethics was condemned by Congress and the Standard Oil Empire was supposedly broken up into smaller Companies.
The Directors that were hired by Rockefeller remained. (Nudge Nudge, Wink Wink)
The US declared the ethics that inspired the Standard Oil Company to dominate the business in the last Century, were deplored
Those ethics now appear to be embraced by the US State Department, as the effort to exploit Europe with LNG is clearly being provided with about the same lack of ethics that the US once deplored.
The US appears to now embrace that form of ethics?
As a Educator who studies Economics, we assume ElErian is aware of those facts?
The yield curve disagrees, and has NEVER been wrong.
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Government bonds will maintain wage’s and pay.
Thank you Mr Elmer Fudd, I giggled every time
Honourable Prof. El-Erian is on this occasion simply grossly incorrect.
Bad Idea
4% inflation is not “stable”. Most people were lucky if they got 2% COL increases a year… they will not get 4%. The lower class will be decimated if inflation is allowed to run at 4%.
This mother has been singing a song that recession is coming etc and that fed needs to go higher etc
Faith in Bidenista data?
Joe Biden 2024?
Today's national 30-year mortgage rate trends
For today, Tuesday, February 14, 2023, the current average rate for the benchmark 30-year fixed mortgage is 6.67%, up 11 basis points compared to this time last week. If you're looking to refinance your current mortgage, today's average 30-year fixed refinance rate is 6.78%, rising 12 basis points from a week ago.
I feel stupid. All this wind vain economics.
El-Erian has flipped.
100% chance of recession
If the fed said 2% I’m pretty sure they mean 2%
Clown show. I'll hold bitcoin and gold thanks.
First time I’ve seen El flip flop
P.S AGAIN —— > BANK OF JAPAN HAS NO OTHER OPTIONS BUT TO HIKE ITS JGB YIELD + IT WILL STOP 'YCC' VERY VERY SOON!!!!!!!!!!!!!!!!!:)
P.S AGAIN THIS TIME WE MAY SEE A REAL DEFAULT OF US DEBT BECAUSE AGAIN IT IS MUCH BETTER THAN A CIVIL WAR!!!!!!!!!!!!!!!!!! AGAIN TOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOO MUCH DEBT TO GO FURTHER FROM HERE!!!!!!!!!!!!!!!!!!!!!!!
I UNDERSTAND WHAT EL ERIAN TRYING TO SAY BUT IN REALITY ——- > IF US FED AGREES LET SAY + 3.5% INFLATION AS A NEW NORMAL THEN —— > MORE AND MORE ECONOMIC RECESSION FROM STAGFLATION COMING TO HIT THE ECONOMY BECAUSE US GDP GROWTH WILL NEVER BE AGAIN BACK TO +3% RANGE GROWTH MEANS ——- > FOR EXAMPLE) THIS YEAR US GDP GROWTH MORE LIKELY WILL BE (-) 0.5% +/- GROWTH – ITS AVG INFLATION +4.5% BASED ON OPTIMISTIC VIEW = (-)5.0% IN REAL GDP GROWTH!!!!!!!!!!!!!!!!!!! < ——— BUT STILL MOHAMED YOU DON'T CALL IT A RECESSION? (-)5%!!!!!!!!!!!!!!!!!!!!!!!!:)
Saying inflation at 3-4% p.a. should be the new normal is crazy. What this basically means is that the poor get even more poorer and that the annual wage increase will not offset inflation. Therefore the "normal" people are loosing even more money so that the gap between poor and rich will only get bigger. But apparently no one cares about that – till the civil war start agains because of the incompetency of the ones in charge. Crazy world
I really like that guy he's seems really grounded. I like mohamed when he's on the show.
The poor are doomed. Central bankers, and central planners, will sacrifice the poor, in order to prop up central banks.
I like El Erian, however the rise in interest rates so far have not controlled inflation and the Fed rate is still below inflation. So to control inflation rates would have to rise above inflation which is ~ 6% to 7-8%. In all likelihood this is not going to happen, so inflation will stay at which level I don't know, but, respectfully, I suspect El Erian does not know either.
P.S ONE OF THE BEST SONGS TO DESCRIBE WHAT THE STAGFLATION LOOKS LIKE IS ——– > Bruce Springsteen – Streets of Philadelphia (Official Video). < ——- YOU CAN SEE IT AND FEEL IT WHAT THE STAGFLATION IS !!!!!!!!!!!!!:)
AS I'VE SAID MANY TIMES SINCE THE END OF 3RD Q OF 2022YR THAT ———- > US FED HAS NO OTHER OPTIONS BUT TO HIKE ITS FUNDS RATE TO THE RANGE OF +7% – +8% THIS YEAR AND US 10YR BOND YIELD WILL BE IN THE RANGE OF +4.5% – +5% BEFORE END OF 1ST HALF OF 2023YR ———- > US 30YR MORTGAGE RATE WILL BE IN THE RANGE OF + 10% IN 2023YR!!!!!!!!!!!!!!!!!!!!!!!:)
WHAT IS GOING TO IMPACT TO OPEC+ ECONOMIES THAT ——– > AGAIN AND AGAIN AS I'VE SAID MANY TIMES THAT NOW US FED HAS NO OTHER OPTIONS BUT TO HIKE ITS FUNDS RATE INTO THE RANGE OF +7% – +8% AND US 30YR MORTGAGE RATE IS GOING INTO THE RANGE OF +10% AGAINST US 10YR YIELD HAS NO OTHER OPTIONS BUT TO RAISE TO + 5% – +6% YIELD RANGE BY THE END OF 2023YR!!!!!!!!!!!
AGAIN AND AGAIN GOLD + ENERGY PRICES HAVE NO OTHER OPTIONS BUT GOING UP AND UP NOW GOLD PRICE IS GETTING BACK TO THE RANGE OF 2K$ AND IT WILL BE IN THE RANGE OF 3K$ – 3.5K$ THIS YEAR BECAUSE AGAIN DO THE MATH THE BIGGEST EVER BOOSTER TO PUSH UP AND UP OF THE GOLD + ENERGY PRICES IS TOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOO MUCH DEBT FROM EVERYWHERE ESP USA CHINA EUROPE!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!:)
It seems to me that we, all of us, have been in recession since May 2020 and only now the world econ driven by the US is coming out of it…markets will rip 30-40 percent from where they are by year end…that is the dow will be at 44K by dec
ONLY GOLD + ENERGY ARE THE SAFE HAVEN ASSETS!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!:)WHO DENIES THE FACT?!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!:)
GAIN AND AGAIN NOW MORE AND MORE FOREIGN INVESTORS ARE SELLING OFF AND OFF AND OFF AND OFF US T – DEBT LED BY JAPAN + CHINA <——— DO THEY HAVE ANY OTHER OPTIONS BUT TO SELL OFF?!!!!!!!!!!!!!!!!!!:)
TO GET STABILIZED ITS FINANCIAL ENGINEERING PROBLEMS OF JAPAN ———- > IT'S A BIG TIME TO APPRECIATE ITS YEN IN VALUE INTO THE RANGE OF 100YEN – 110YEN RANGE SOONEST POSSIBLE AGAINST NOT ONLY ITS INFLATION BUT ALSO AGAINST ITS FINANCIAL IMBALANCES!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!:)