El-Erian: If Trump Wins, S&P Could Drop 5-10%

The transcript discusses potential market reactions to political events, particularly if Donald Trump wins the election and reiterates anti-trade rhetoric. It predicts significant market movements, including a decline in the S&P 500 and changes in bond markets and currencies. Investment strategies are advised, focusing on tactical positioning and name selection. The US political climate is analyzed, highlighting congressional gridlock and its impact on economic policy. Finally, investment exposure and market distortions are discussed.

What is the expected impact on the S&P 500 if Donald Trump wins the election and reiterates anti-trade rhetoric?

• A 5 to 10% decline

• A 5 to 10% increase

• No significant change

• A 15 to 20% increase

Which type of securities are expected to perform well if the two 'ifs' materialize?

• Corporate bonds

• High yield bonds

• Emerging market stocks

• Inflation protected securities

What is a key investment strategy mentioned for making money in the current market?

• Investing heavily in public markets

• Focusing on name selection with strong balance sheets

• Buying indices and holding

• Avoiding technological disruptions

What does Paul Krugman suggest about the US political situation?

• The US will easily pass new economic policies

• The US has no political gridlock

• The US will lose its investment grade rating

• The US is close to a failed state

What is the speaker's current exposure to UK assets?

• No exposure to UK names

• High exposure to UK names

• Complete divestment from UK assets

• Moderate exposure to UK names