Шухер переписывайте контракты в японские йены 'Danger zone': Investment bank Citigroup issues US recession warningMultinational investment bank Citigroup has issued an explicit recession warning for the United States, advising clients to wind down exposure to risky assets and prepare to ride out the storm. The bank's global investment team said the US Federal Reserve over-tightened monetary policy last year, waiting too long to stop raising interest rates or to slow the pace of quantitative tightening (reverse QE). The economy is already shot below the waterline and will most likely succumb to the textbook pathologies of a fading expansion. "The US economy seems to be transitioning into a stagnation phase after a brief period of goldilocks on a sugar high of fiscal stimulus. We advise investors to prepare for recession," it said. Wall Street stocks and global bourses may keep climbing for a few more months before peaking in July. "Equities typically rally a little before the cycle ends," it said. Recessions are toxic because they set off a chain reaction through financial deleveraging. Such a slump today would lead to an avalanche of "fallen angels" among US companies that have increased debt from US$2.5 trillion to US$6.5 trillion in nine years, mostly to buy back their own stock. Citigroup said the US Conference Board's leading indicator has begun to turn down, a signal that should not be ignored. The short-term boost from Donald Trump's tax cuts is fading. The labour market is strong but it offers a rear-view mirror of the economy. Jobs gave almost no prior warning of recession in 1973, 1981, 2000, and 2007. If you want the ultimate safe-haven, buy the Japanese yen. Citigroup has pencilled in 105 to the dollar later this year and 93 over the long-term. It is 111 currently.
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