Top economist Mohamed El-Erian sounds recession alarms and warns of stagflation after slew of bank failures last month

• Mohamed El-Erian said the US economy is facing increasing odds of a recession and stagflation.
• He sees a significant contraction of credit as the banking system becomes more cautious.
• "It is a phenomenon that, unlike financial contagion, is not easily countered by policies."

Mohamed El-Erian said the US economy is facing increasing odds of a recession and stagflation after turmoil snarled the global banking sector for the past month. 

"The flashing red light resulting from a speed-of-light run on the US banking system, or what economists broadly refer to as financial contagion, is behind us," the famed economist wrote in the Financial Times. "Yet it is too early for policymakers to declare mission accomplished."