Markets Are Underestimating Inflation Shock, El-Erian Warns

The video discusses the recent short squeeze and its impact on market narratives, highlighting three key elements: technical, fundamental, and policy factors. It examines headwinds to global growth, including issues in the US, China, and the Delta variant. The discussion also covers the role of policy, particularly the ECB's stance, and the balance between these elements. The speaker suggests that the market is underestimating inflation and the Fed's response, predicting high yields and increased pressure on the Fed to adjust its timetable.

What is the speaker's gut feeling regarding the driving factors behind the recent market movements?

What does the speaker believe about the Fed's current position?