Economist Mohamed El‑Erian warns that President Donald Trump’s trade and tariff regime has set the U.S. up for one of two extremes: either a “Thatcher‑Reagan era on steroids,” or “Jimmy Carter’s stagflation all over again,” and he puts the odds at 50‑50.
What Happened: The former CEO of fixed income giant PIMCO says everyone inside and outside the Trump administration broadly agrees that the economy is in for a “bumpy journey.” The disagreement, he says, “is on the destination,” while speaking on MSNBC’s Velshi on Sunday.
El-Erian says there are two views on this, one is the administration’s view, that we will emerge from this with a fairer trading system, where the rest of the world reduces tariff and non-tariff barriers, while also taking responsibility for their own defense.