Mohamed El-Erian warns of recession, Fed-triggered financial accidents and commercial real-estate's 'moment of truth'. The top economist told us why, in an exclusive interview.
A credit squeeze is threatening the US economy, high interest rates have heightened the risk of"financial accidents", and the commercial real-estate sector is facing its"moment of truth," Mohamed El-Erian told Insider in an exclusive interview.
"Having started late in addressing inflation, the Fed has been forced into a highly concentrated set of rate hikes that have not only enormously narrowed the path for a soft landing but have also increased the risk of both recession and financial accidents," El-Erian said on Wednesday.
"Yes, some banks are, and will need to reduce their loan books due to the loss of deposit and capital pressures. As such, this increases the likelihood of an economic slowdown," he said.
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