Guggenheim Investment Chief Sees A Recession And A 40% Plunge In Stocks Ahead

CNBC – April 6, 2018: The article highlights that Guggenheim chief investment officer Scott Minerd is warning clients that the market is on a “collision course with disaster.” He sees a recession, a 40 percent plunge in the stock market and a wave of corporate debt defaults. And he expects the Fed to intervene to stem the crisis but says that will only make matters worse.

“For the next year (2019) … equities will probably continue to go up as we have all these stock buybacks and free cash flow,” Minerd told CNBC’s Brian Sullivan in a “Worldwide Exchange” interview. “Ultimately, when the chickens come home to roost and we have a recession, we’re going to see a lot of pressure on equities especially as defaults rise, and I think once we reach a peak that we’ll probably see a 40 percent retracement in equities.”

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CASHIN: Market volatility reminiscent of ’87 crash

CNBC – April 6, 2018: According to the article veteran trader Art Cashin says this year’s market volatility is reminiscent of the 1987 stock market crash. “It’s a good deal more volatile than almost anything else you’ve seen,” Cashin says. And that this year has increased volatility in equity markets is caused by fears of potential trade wars and increased scrutiny in the technology sector.

Cashin, now one of six executive floor governors at the New York Stock Exchange, was referring to the volatile market that began on Oct. 19, 1987, in Asia before spreading to Europe and then the United States later in the day.

“This is the year (2018) of volatility,” Stephanie Link, managing director and U.S. equities manager at Nuveen, said on “Closing Bell.” Link pointed out that there were 28 days in the first quarter alone when the market has moved plus or minus 1 percent, compared with only eight times in all of 2017.

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