Brunello Rosa, a top Global Economist, states: "We are Nowhere Near the Bottom"
The volatility of the economy is most likely going to continue into the summer and maybe further than that...
The stock market has seen some crazy volatility the past few weeks and the continuation of heavy selling is set to carry on into the summer as interest rates around the world are surging behind efforts to ease inflation.
The CEO and head of research at Rosa & Roubini, Brunello Rosa, believes there is much more tightening coming from central banks around the world along with a continuation of bad news for economic activity within the stock market.
“Now it’s time for a reappreciation of the economic fundamentals around the world in terms of growth. It’s hard for markets to be totally optimistic when inflation is going up, growth is going down and interest rates are rising fast across the globe.”
Brunello Rosa said on “Street Signs Europe” today.
Yesterday, the Dow shed nearly 1,000 points and the NASDAQ also shed 5% which erased the bear rally from Wednesday. The growing concern is the harming of economic growth caused by the aggressive rate increases being implemented by the United States Fed.
Investors invited the 75bps hike being off the table but it is said to be a ploy as multiple 50bps hikes over the next few months are more likely. The only central bank being realistic in the eyes of Brunello Rosa is the Bank of England after warning United Kingdom citizens of recession risks and the shitty economy the U.K. is experiencing.
Brunello Rosa stated that banks continue to talk tough but miss the reality that tightening at this rate will eventually lead to an economic contraction. “In the eurozone and in the U.S. they are nowhere near realizing that actually there will be some form of contraction of economic activity,” Brunello said.
The war in Ukraine will last much longer than expected according to Brunello Rosa which will add to the already existing supply chain issues, soaring inflation, and the never-ending rising of interest rates across the globe.