Late on Friday CNBC interviewed El-Erian on the Trade War topic. According to El-Erian, we should expect the US to win the War. Below is a summary of his views from CNBC:

  • As trade tensions continue, Mohamed El-Erian, chief economic advisor at Allianz, says the U.S. “will win the trade war.”
  • Investors have been on edge with some fearing that Trump has gone too far with his nontraditional negotiating tactics.
  • “One of the upside risks, is that you may end up changing, the global landscape in a way that favors the U.S.,” he says.

“When people realize that at the end of the day, the US will prevail, because [China] is a less open economy, because [the US] is a more dynamic economy, that ultimately you may end up in a situation where the US’ position in global economic terms is better off,” he said.

Year to date the winner is Russia and the loser China if one is to judge the Trade War by index performance.


What’s next? Well, nobody knows, but if soybeans are telling us something, it seems rather bearish. Soybeans are taking out new recent lows as the free fall continues. Shanghai is following soybeans. Let’s see what the rest of the world follows.