Jeff Bezos becomes latest exec to warn about looming US recession: 'Batten down the hatches'
Chorus of corporate executives sound alarm over US economy
Potomac Wealth Advisors founder and president Mark Avallone says he doesn't expect robust economic growth 'from here on out.'
Amazon founder Jeff Bezos became the latest influential executive to sound the alarm over the state of the U.S. economy.
In a tweet on Tuesday evening, Bezos indicated that he agreed with comments made earlier in the day by Goldman Sachs CEO David Solomon, who cautioned that there is a "good chance" of a U.S. recession.
"Yep, the probabilities in this economy tell you batten down the hatches," Bezos, the second-wealthiest man in the world, wrote.
Bezos and Solomon are just the latest in a chorus of corporate executives who are warning about a looming recession as a confluence of economic crises including stubbornly high inflation and an increasingly aggressive Federal Reserve converge.
INFLATION SURGED MORE THAN EXPECTED IN SEPTEMBER AS PRICES REMAIN PAINFULLY HIGH
Amazon CEO Jeff Bezos speaks at the Amazon re:MARS convention in Las Vegas, Nevada, on June 6, 2019. (AP Photo/John Locher / AP Newsroom)
JPMorgan Chase CEO Jamie Dimon last week said the U.S. is likely headed for a recession within the next six to nine months as a result of steeper interest rates and the war in Ukraine.
"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.
He warned the S&P 500 could tumble another 20% as a result of such a downturn.
The Jersey City Skyline, including the Goldman Sachs Tower, is seen from Liberty State Park with CEO David Solomon. (Getty Images/iStock / Getty Images)
There is a growing expectation on Wall Street that the Fed will trigger an economic downturn after it embarked on one of the fastest courses in history to raise borrowing costs and slow the economy.
FED BARRELS TOWARD ANOTHER 75 BASIS POINT RATE HIKE AS HIGH INFLATION PERSISTS
Officials in September approved a third consecutive 75-basis-point rate hike, lifting the federal funds rate to a range of 3% to 3.25% — near restrictive levels — and indicated that more super-sized increases are coming.
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.
The Marriner S. Eccles Federal Reserve Board Building in Washington, D.C. (Kevin Dietsch/Getty Images / Getty Images)
Fed Chair Jerome Powell has all but conceded the central bank will tip the economy into a recession with its rapid rate hikes, warning that higher rates will cause economic "pain."
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"The chances of a soft landing are likely to diminish to the extent that policy needs to be more restrictive or restrictive for longer," Powell told reporters in Washington in September. "Nonetheless, we’re committed to getting inflation back down to 2%. We think a failure to restore price stability would mean far greater pain."