- Ark Invest Wood Cathie warned that the economy could go to one or two negative districts in the midst of a “hilly recession” while concerns about the safety of jobs push Americans to save money rather than spending it. But the slowdown will help to release the federal reserve to reduce interest rates and set up the Trump administration to reduce taxes.
The founder and CEO of Ark Invest, Cathie Wood, is down to the short -term perspectives of the economy, but expects the Federal Reserve and the Trump administration to increase soon.
In a Interview with Bloomberg TV On Tuesday, she also noted that she had bought Tesla actions and assets related to crypto like Coinbase and Robinhood during the slowdown in the market.
The shares have dropped since mid-February while investors fear that the aggressive prices and the reductions in the workforce of President Donald Trump to switch the economy in recession. Wall Street forecasters have been chances of recession, some putting them at around 50%.
“We believe that we have been in a rolling recession and that we will actually see negative districts here and it is because the speed of money collapses,” said Wood to Bloomberg, referring to economic slowdowns that affect different sectors at different times.
She added that job security concerns encourage Americans to save more of their money and predicted one or two negative quarters. But in his opinion, this will set up the Trump administration for tax reductions and the Fed for rate reductions.
The day after speech, the FED maintained stable rates while central bankers have dropped their growth forecasts for the year and raised their inflation expectations in the midst of higher rates.
But political decision -makers have also largely maintained opinions for two rate drops this year, and the generally dominant tone of the president of the presidency of Jerome Powell during her press conference assured some to Wall Street that the “Fed could” remains at stake, which means that the rates will drop if the economy worsens.
For its part, Wood sees two or three rate drops this year – or perhaps even more – as inflation cools, with prices for food, petrol and certain rents that are already falling. In addition, innovation also leads to a “good deflation”, contributing to an additional price of prices.
“We believe that the Fed will have many more degrees of freedom in the second half of this year than most people think it,” she said. “We could see more than the number I just suggested, two to three cups.”
Meanwhile, the CEO of Doubleline Capital Jeffrey Gundlach said to CNBC Thursday The fact that federal government’s budget cuts weaken economic growth and warned that the chances of a recession are higher than most people think.
“I actually think it’s more than 50% in the coming quarters,” said Gundlach. “I think 50 to 60 (percent) are there that I am.”
Gradator views of the economy and American actions, associated with relative outperformance on the markets formerly, have eroded belief in so-called American exceptionalism.
Gundlach thinks that it is probably time for investors to diversify far from American assets, pointing to Europe and emerging markets.
“I think it will be a long-term trend,” he said.
This story was initially presented on Fortune.com
