Bracing for a Hard Landing - FOX Business Varney & Co.
Eddie Ghabour, Co-founder and CEO of KEY Advisors Wealth Management, joins Stuart Varney on his @FoxBusiness show, Varney & CB, on March 15 after the SVB (Silicon Valley Bank) failure.
"What's the big problem?"
Eddie believes it gets worse from here, and there is nothing anyone can do to stop it. He warned his clients of a liquidity event weeks ago, and now that has happened, it is yet another signal that we will have a hard landing and worse than expected recession. This is the start of a cycle that cannot be reversed.
Unfortunately, this results from living in a world of free money/low-interest rates. Now that interest rates have normalized, businesses face record increases in the cost of capital aligned with weakening consumer demand. This is a recipe for disaster for businesses, especially small businesses.
Finally, Eddie believes that the Fed will not skip an increase in interest rates next week. While inflation is beginning to reverse, which is what happens in a recession, because inflation is still higher than the Fed target, and Powell reversing on his statements from last week would be a credibility issue.
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