FORECAST FOR RECESSION WITHIN YEAR HITS 100%
NEW YORK (TIP): A growing number of influential Wall Street executives and business titans have sounded the alarm over the state of the U.S. economy. Relentless inflation, combined with the most hawkish Federal Reserve in decades, have raised the specter of a recession, according to some of the most prominent CEOs in the country.
The U.S. central bank has embarked on one of the fastest monetary tightening paths in decades as it seeks to wrestle consumer prices that are still running near a 40-year high back to 2%.
In a troubling development, however, the Fed’s rate hikes have thus far failed to tame inflation: The government reported last week that the consumer price index soared 8.2% in September from the previous year, faster than expected. Even more concerning, core prices – which exclude more volatile measurements of food and gas – jumped 6.6%, the fastest since 1982.
Economic growth already contracted in the first two quarters of the year, with gross domestic product – the broadest measure of goods and services produced in a nation – shrinking by 1.6% in the winter and 0.6% in the spring, signaling the start of a technical recession.
David Solomon
Goldman Sachs CEO David Solomon recently warned that there is a “good chance” the U.S. economy tumbles into a recession, warning investors to brace for turbulent waters ahead.
Jeff Bezos
In a tweet on Tuesday evening, Bezos indicated that he agreed with comments made earlier by Solomon about the likelihood of an impending recession.
Elon Musk
In early August, Musk became one of the first prominent CEOs to issue a dour economic outlook: the Tesla and SpaceX executive said he estimated that the U.S. was “past peak inflation” and likely to see a “relatively mild recession” that lasts for about 18 months.
Jamie Dimon
JPMorgan Chase CEO Jamie Dimon last week said that the U.S. is likely headed for a recession by mid-2023 as a result of steeper interest rates, runaway inflation, the war in Ukraine and the unknown effects of the Federal Reserve’s quantitative tightening policy.
“These are very, very serious things which I think are likely to push the U.S. and the world — I mean, Europe is already in recession — and they’re likely to put the U.S. in some kind of recession six to nine months from now,” Dimon said during an interview with CNBC on Oct. 10.
Sundar Pichai
The CEO of Alphabet, the parent company of Google, warned staff in September about the “toughest macroeconomic conditions” over the past decade as it tries to prepare for the possibility of a so-called hard landing.