Tags: Coronavirus | el | arian | economy | recovery | coronavirus

Economist El-Erian: Economy In for 'Bumpy' Ride to Recovery

mohame el-erian speaks on a tv set
Mohamed El-Erian, chief economic adviser of Allianz appears on a segment of "Mornings With Maria" with Maria Bartiromo on the FOX Business Network.  (Photo by Rob Kim/Getty Images)

By    |   Sunday, 17 May 2020 01:51 PM

Allianz chief economic adviser Mohamed El-Erian says the coronavirus pandemic was “an enormous shock” to the economy, predicting it’s in for a “bumpy” ride going forward.

In an interview aired on “Fox News Sunday,” El-Erian said uncertainty is the future, for now.

“This is the biggest shock we’ve had for generations,” he said. “The main reason is health.”

“It’s going to be a long time for us to trust each other” until there’s a vaccine, he added. “You have shaken behaviors … and third, businesses, it’s unclear how to restart businesses.”

He said the “three massive uncertainties are all in play at the same time,” and that “I think we should buckle our seat belt, it’s going to get bumpy still.”

El-Erian also doubted the Trump administration’s prediction of a V-shaped recovery.

“Think of a pendulum instead” that has swung to a lockdown “and now we’re going to swing back and forth trying to find the new equilibrium..”

The pattern of recovery will be “more like a lot of W’s,” he added. “It’s an uncertain outlook.”

According to El-Erian, the Trump administration relief so far has been good, but now must transition to “infrastructure” and “safety nets.”

“We’ve had government relief. It’s a good thing we had it — $5 trillion worth of reaction,” he said.

“We are hurting and thank God the government has reacted on the relief measure … but there’s a second phase. This is not about winning a war against a depression … but to make sure we emerge strong.”

He said without a focus on "infrastructure” and “safety nets,” the nation will “get stuck in mediocre growth and … social tensions.”

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Allianz chief economic adviser Mohamed El-Erian says the coronavirus pandemic was "an enormous shock" to the economy, predicting it's in for a "bumpy" ride going forward.In an interview aired on "Fox News Sunday," ...
el, arian, economy, recovery, coronavirus
Sunday, 17 May 2020 01:51 PM
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