El-Erian Says Cut Stock Holdings - Stagflation

I would reduce equities at this point. “The market is giving you a wonderful opportunity to come out.” 

“I don’t think the market has factored in yet what’s going to happen to the economy,” 

The relative value of stocks may prove vulnerable. “My baseline, for what it’s worth, is we’re going to see a global stagflation, lower growth, higher inflation,” El-Erian said. 

“The equity market hasn’t quite priced that in yet because it’s still thinking in a relative space.”

https://www.bloomberg.com/news/articles/2022-03-22/el-erian-says-cut-stock-holdings-as-stagflation-concern-grows


Fed is increasingly being forced to consider what is the least bad policy mistake it wishes to be remembered for: meeting its inflation target by causing a recession, or allowing high and potentially destabilizing inflation to persist well into 2023.

Mohamed A. El-Erian Bloomberg 22 mars 2022


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