Mohamed El-Erian Add to myFT
Mohamed El-Erian is President of Queens’ College, Cambridge University, an advisor to Allianz and Gramercy and a best selling author. He previously served as chief executive and co-chief investment officer of Pimco, deputy director of the IMF and president and CEO of Harvard Management Company. He is the Rene M. Kern Practice Professor at the Wharton School of the University of Pennsylvania.
US inflation surge signals tough times ahead
He gets a lot right but what he misses is just astonishing for somebody that "credentialed".
"At 9.1 per cent for June, the headline number for US CPI inflation came in well above the median forecast of 8.8 per cent, registering its highest level since 1981. The core measure was also higher than expected and the compositional details added to concerns."
"This level of inflation will come as a shock to many, especially those who have been falsely comforted by a US Federal Reserve narrative that, from day one of this inflation episode, has failed to understand the dynamics in play, grasp the seriousness of what’s ahead, and act promptly and decisively to avoid undue harm to so many."
( "This level of inflation will come as a shock to many" Not if you've been following me it shouldn't...)
"The stunning number, which will be splashed across the front pages of newspapers and dominate news shows and websites, will further erode the already-damaged policy credibility of the Fed and undermine the effectiveness of its all-important forward guidance tool."
"And this is a Fed that, unlike the European Central Bank, is yet to explain why it has forecast inflation so wrong for so long; and unlike the Bank of England, is yet to play the technocratic role of an honest adviser on what is going on in the economy and why."
(Because Wall Street likes "loose monetary policy? (0% interest rates basically). Anybody ever think of that? That they were beholden to their masters for as long as possible till they absolutely had to do something? These people are just not this incompetent.)
"Fortunately, inflation will come down over the next three months. That’s the good news."
(This guy...My goodness...What is the difference between his complaining about the Fed calling inflation transitory and him stating its going to come down over the next three months? Neither of those statements, by the Fed or by Mr. El-Erian had a shred of evidence supporting it. Where is this guys evidence that inflation is going to come down over the next three months? Where is the metric he is using to support such a conclusion? Why didn't he publish it with his article? On and On and On these pundits...good lord, get a grip people, ITS HERE!...)
(Inflation is not going to go down until one of two things happen, or both.
1) The war in the Ukraine stops.
2) Oil refining capacity increases.
Period.
Anything anybody else tells you is worthless drivel.
You see either of those two things happening anytime soon?
Me neither.
This is coming from the guy that stated on July12th:
"Oh, and inflation hasn't even started, let alone peaked."
and then todays news:
(This is a forward looking indicator, meaning the things being used in product are costing more, so that when items hit the shelves later they are most certainly gonna cost more as well.)
and this from yesterday:
"U.S. inflation surged to a new four-decade high in June because of rising prices for gas, food and rent..."
I love how the article says: "raising risk for the economy."
Forget the economy, what about the people who cant afford gas, food and rent?
What do you really think happens in situation where people cant afford what they need to get by on in life? At this pace, how far off do you really think we are from major domestic unrest? And I didn't say a word about water levels in lake Meade and lake Powell. Wait till next year when those damns are no longer operational and water can not be used to irrigate agriculture or turn the turbines to create electricity etc...Then where do you think were gonna be?..
Your creator is trying to tell you:
"You are not in charge"
You better recognize it, accept it and submit to him.
It is your only hope...)
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