Roubini, the economist known as "Dr. Doom" who was famous for accurately predicting the 2008 financial crisis, said on Monday that he is now more worried about a "hotter" U.S. economy, the so-called "non-landing", which may have a negative impact on the economy. The stock market has a negative impact.

Although there is a lot of talk about the so-called soft landing, he believes that the U.S. economy may not land at all, and in the case of "no landing", economic growth will continue to accelerate.

Roubini added that he was now less worried about the U.S. economy slipping into recession. He said Fed policymakers in December expected to cut interest rates three times this year, by 25 basis points each time, but the number of cuts may end up being fewer. Roubini said in an interview on Monday:

"Earlier this year, the market expected the Fed to cut interest rates six to eight times. Now they have agreed with what the Fed told us, only three rate cuts, but if the economy grows well above potential due to technical and other factors, and the Fed does not cut rates Three times, only two, one, maybe even no interest rate cut, what should we do?”

"In reality, there's a good chance of what people call a 'no landing', where growth remains above potential and inflation remains tricky," Roubini said.

Tom Lee, a well-known Wall Street bull and co-founder and research director of Fundstrat Global Advisors, a US investment institution, also warned that February CPI data may still be "hot" and may trigger the worst sell-off in the stock market since the record rebound began at the end of October last year. .

As Roubini mentioned, current market expectations for Fed rate cuts have become more conservative in recent months. CME Group's FedWatch tool currently shows traders see the highest likelihood of a 100 basis point rate cut this year, 50 basis points lower than their expectations in mid-December 2023.

Based on recent precedents, the CEO of consulting firm Roubini Macro Associates LLC and emeritus professor at New York University believes that a "non-landing" of the U.S. economy will bring serious downside risks to the market. He noted that last year, when the Fed made tough revisions to its interest rate forecasts in August and September, the stock market experienced a 10% correction.

"It's a potential paradox that good news could be bad news for markets if the economy does too well and means the Fed won't cut rates as sharply as people now expect," he said.

Article forwarded from: Golden Ten Data

熱點： DR IS LAND