Stock market kicks off 2023 with start of 'lost decade,' expert warns

After Wall Street wrapped its worst year since 2008, one stock market expert is warning 2022 was just the beginning of "a lost decade."

"[In] 2022, we saw the stock market hit its record highs and then now we've seen the market go down. So it's the worst time that we've actually seen for both stocks and bonds in this one-off year," Sound Planning Group CEO David Stryzewski told Fox Business’ Stuart Varney on Tuesday. 

"And so as we look forward to the future here over the next 10 years," he continued, "I think that a lost decade is very likely, given the fact that we have so much pressure coming from so many different areas all at once."

U.S. stocks closed lower on Friday, rounding out the worst year for stocks since 2008 as investors wrestle with sky-high inflation and a recession that could deepen in 2023.

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The S&P 500 fell 9.78 points, or 0.3%, to finish at 3,839.50. The index posted a 5.9% loss for the month of December.

The Dow dropped 73.55 points, or 0.2%, to close at 33,147.25. The Nasdaq slipped 11.61 points, or 0.1%, to 10,466.48.

Stryzewski further argued that the Federal Reserve’s actions throughout 2022 also put the economy in a "very, very difficult spot" for recovery.

"I'm calling it the Federal Reserve bubble," the market expert said. "I believe that there is a bubble in the stock market, there's a bubble in the bond market here today. We've got a real estate bubble, and that's also hurting corporations as we look at how they are no longer able to borrow at such low-interest rates."

To get out of these bubbles, Stryzewski called for a "number" of policy changes, specifically in the energy and real estate sectors.

"I'd say that we start pumping some oil again, and that's really going to help the United States," he said. "This real estate bubble is just beginning to peak, and one thing to understand about real estate is that it's a lagging indicator of economic health. And so as it's starting to peak out, I've got high expectations here that what got us to this place as far as success goes, is likely going to be one of the challenges that we have in the future. Growth stocks, as an example, will likely have big challenges moving forward to the future."

The market expert and investor expanded on the danger around growth stocks like Microsoft in 2023, calling them "risk assets."

"If it's one of your favorite companies, I'm going to say that it's going to likely have a better story as the future unfolds because of how we're doing work-at-home right now," Stryzewski explained. "But I'd say that we do need to be a lot more protected as we're looking forward here. And in 2023, 2024, especially, the tide seems to be going out."

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Wedbush Securities managing director Dan Ives shared a similar sentiment about the 2023 economy on "Mornings with Maria" Tuesday, cautioning that Big Tech companies still need to "rip the Band-Aid off" in terms of layoffs as a "Category 5 storm" threatens the macroeconomic landscape.

"Look, a lot of Big Tech, they were spending money like 1980s rockstars. And I think that really shows," Ives explained. "Sometimes they were increasing 15, 20% per year. I still think it’s a ‘rip the Band-Aid off,’ still some more headcount cuts. We think potentially another 8 to 10% headcount cuts in Big Tech. You look at what happened with Meta, and that’s a good example. Once Zuckerberg finally read the room, cut in terms of what he needed to, stock ultimately lifted. I think, be that as a catalyst, I think you will see a continued cutting of heads in Big Tech because they're getting ready for the Category 5 storm in terms of what we're seeing with the macro."

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FOX Business’ Ken Martin contributed to this report.