“Prepare for turbulence as a brief recession looms on the horizon, but don’t lose sight of the silver lining – billionaire investor Steve Cohen predicts a triumphant stock market rally by 2024.”
Steve Cohen, the billionaire chief of hedge fund Point72 and the owner of the New York Mets, has an upbeat outlook for the US economy and financial markets. In comments shared at a recent conference, he said a short-lived recession could hit the US before the end of this year. However, he believes it will be a “fake scare” that briefly spooks investors but the repercussions won’t last.
Cohen stated that the downturn will only be short-term in nature and that his firm maintains a “pretty positive” outlook for the economy. This comes as real gross domestic product data showed that the US economy grew at a 4.9% annualized rate in the third quarter.
Cohen predicts that economic growth will increase in 2024 and expects stocks to climb 3%-5%. He believes this could ultimately lead the Fed to keep interest rates higher than people anticipate.
However, not everyone shares Cohen’s optimistic view. Investing pioneer Rob Arnott warned that the economy’s recent strength should not be taken as reassurance for a no-recession scenario. He emphasized that recessions often start with a booming economy before rolling over.
Meanwhile, Federal Reserve Chairman Jerome Powell and other central bank officials have shared divided takes on the path of monetary policy. Inflation remains above the Fed’s 2% target, but markets do not expect a rate hike in the near future.
Overall, while Cohen remains positive about the US economy and financial markets, there are varying perspectives and uncertainties regarding a potential recession and the future direction of monetary policy.