Authorization

There is a fundamental misunderstanding of inflation and its spread throughout sectors of the economy proves it is not isolated or transitory, Mohamed El-Erian says

There is a fundamental misunderstanding of inflation and its spread throughout sectors of the economy proves it is not isolated or transitory, Mohamed El-Erian says

Mohamed El-Erian.
Rob Kim/Getty Images




Mohamed El-Erian said there is a fundamental misunderstanding of inflation because few people have lived through it.




"I always laugh when people say, oh, it's isolated, it's transitory," El-Erian told CNBC on Monday.




He also disagreed with the Federal Reserve's view that inflation is transitory.




Sign up here for our daily newsletter, 10 Things Before the Opening Bell


Economist Mohamed El-Erian in an interview Monday took aim at assessments of inflation that describe rising prices as "transitory", stating that there is a fundamental misunderstanding of what inflation is and how it is already spreading throughout the economy. "I always laugh when people say, oh, it's isolated, it's transitory," the Allianz's chief economic adviser told CNBC. "I think there's a fundamental misunderstanding about inflation today because ... most people haven't lived through it for a long time and certainly most traders on Wall Street haven't traded through it."El-Erian pointed to the surge is used cars prices to their highest in more than 60 years, which has been followed by an increase in prices of new cars, and an rise in the price of rental cars. This, he said, shows inflation is not contained. "There is a logic to these inflation chains. They take time, and most people, unfortunately, haven't seen them," El-Erian told CNBC. "So they think everything's isolated. Actually, it's not. It's interconnected."

El-Erian, who is also the president of Queens' College, Cambridge University, countered the longstanding narrative of the Federal Reserve that inflationary pressures are temporary.
See also:
Leave a comment
News
  • Latest
  • Read
  • Commented
Calendar Content
«    Ноябрь 2022    »
ПнВтСрЧтПтСбВс
 123456
78910111213
14151617181920
21222324252627
282930