Fund managers warn a downturn is coming and 'it's going to be pretty ugly'
The signs are starting to add up that the United States is at the top of the economic cycle, and therefore headed down, likely into a bear market and recession, an increasing number of economists and money managers say. The main culprit for the looming downturn, they say, is the Federal Reserve, which is expected to again raise U.S. overnight interest rates on Wednesday.
Led by new Chair Jerome Powell, the Fed is slowly bringing interest rates up from zero, where they stood for around a decade, attempting to stabilize the economy and keep inflation from creeping higher. While few argue that interest rates should remain at zero forever, many are expecting the withdrawal of the liquidity cushion the U.S. central bank has provided for the economy to lead to some negative consequences.
“When the music stops I do think it’s going to be pretty ugly,” said Jonathan Beinner, chief investment officer of global fixed income at Goldman Sachs Asset Management.
finance.yahoo.com
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