Economist Mohamed El-Erian said that the Fed’s description of inflation as “temporary” is “the worst call in history” – Economics Bitcoin News

Economist Mohamed El-Erian said that the Fed’s description of inflation as “temporary” is “the worst call in history” – Economics Bitcoin News



On Monday, December 13, following the US Consumer Price Index report released by the US Bureau of Labor Statistics on Friday, Americans are discussing the Federal Reserve. With inflation looming over the US economy, thousands of tweets on the topic of the Federal Reserve have been popular on Twitter. In addition, according to a recent interview, Mohamed El-Erian, chief economic adviser of the German multinational financial services company Allianz, stated that the term “temporary” is “the worst inflation forecast in history.”

Allianz’s chief economic adviser said that the U.S. central bank’s call of inflation “temporary” was a misjudgment

At the end of April 2021, members of the Federal Open Market Committee (FOMC), Tell the American public The Fed will keep the benchmark interest rate close to zero and continue to buy bonds every month. Statement by FOMC and Federal Reserve Chairman Jerome Powell Emphasize Inflation will only have a “temporary impact” on the US economy.Fed members not only stated that inflation will be temporary, but also Often parroting The media, U.S. policymakers and U.S. banking giants as well as.

Just before the release of the November Consumer Price Index (CPI) report from the Bureau of Labor Statistics, “temporary” conversation leaders started touting inflation as temporary.Latest CPI report Indicated This indicator jumped to the highest level in nearly 40 years, and soared to 6.8% in the same period in 2020. The cost of goods and services in the United States continues to rise month by month, and more and more Americans are beginning to point out and blame the U.S. Central Bank.

For example, the name “Federal Reserve” is Quite popular On Twitter, and can be seen in thousands of tweets in the United States.On Sunday afternoon, the chief economic adviser of the German multinational financial services company Allianz Criticize the Fed On the broadcast of CBS’s “Face the Nation” program. Mohamed El-Erian said that the “temporary” description is one of the worst calls in the history of the Federal Reserve.

“Describing inflation as temporary may be the worst inflation forecast in the Fed’s history, which is likely to lead to policy errors,” Erian insisted in an interview. Allianz’s chief economic adviser said: “Therefore, the Fed must quickly regain control of inflationary rhetoric and restore its own credibility starting this week.” El-Erian further added:

Otherwise, it will become a driving factor leading to rising inflation expectations.

Critics use terms such as “fraud” and “bankruptcy” to condemn the Fed’s actions, and El-Erian says the central bank can still change its course

Sven Henrich, The analyst behind Northman Trade Network, Condemned US President Joe Biden’s recent tweet when the President stated that he was raising the debt limit. “The U.S. repays its debt by taking on more debt,” Henry Xi Tweet“[And] When it cannot find enough buyers for its debt, it will let the Federal Reserve buy its debt, which currently exceeds $5.6 trillion. [And] If interest rates return to 2007 levels, the United States will go bankrupt. “

Popular financial writer Carol Rose He also criticized the Fed’s monetary policy decision on Twitter. “If you enter your bank account, increase your balance digitally, and then buy something with the new balance, it will be called fraud,” Ross Say“When the Fed does this, it is called monetary policy,” she added. In an interview with CBS, El-Erian claimed that the U.S. Central Bank might take power and control the economy. “If they catch up now, if they are honest about their mistakes and take immediate measures, they can still regain control of it,” El-Erian commented.

Up to now, the Fed has been talking about changes in interest rates and gradually reducing quantitative easing measures, but so far has not implemented any discussions. However, El-Erian believes that the U.S. Central Bank should “relax the throttle” instead of shrinking it at a very rapid rate.The economist further stated that unlike some media experts, the rich will be affected by inflation. Publicly claim, El-Erian insists that low-income households are more susceptible to rising inflation.

“They may have to raise interest rates,” El-Erian concluded. “Listen, it’s important to stop inflation [from] It is embedded in the system because two things happen when inflation is embedded. One, you lose purchasing power, and the poor suffer the most. Second, the Fed overreacted, then the recession, and then revenue loss. So, you really want to go through this process in a timely and orderly manner. “

Tags in this story

1982, Allianz, American public, Bureau of Labor Statistics, Carol Rose, car, Consumer price index, Consumer Price Index, economics, economy, Erian, vitality, Federal Reserve, U.S. Federal Reserve, food, housing, inflation, Rising inflation, Inflation is temporary, Jerome Powell, fluidity, Mohamed Erian, Sustained inflation, politics class, Purchasing power, Sven Henrich, temporary, U.S. inflation

What do you think of the recent criticism of the Fed and Mohamed El-Erian’s statement about the Fed’s “temporary” description of inflation? Please tell us your thoughts on this topic in the comments section below.

Jamie Redman

Jamie Redman is the head of news at News and a fintech reporter living in Florida. Since 2011, Redman has been an active member of the cryptocurrency community. He is passionate about Bitcoin, open source code and decentralized applications. Since September 2015, Redman has written more than 4,900 articles about destructive protocols emerging today for News.

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