An investment expert warns that the US is in the ‘biggest bubble of our lives’

Eddie Ghabbour, co-founder of Key Advisors Group LLC, warned on Wednesday that the US is in the “biggest bubble of our lives” and will burst as the Federal Reserve “will suck liquidity out of the system.”

Ghabbour predictedVarney & Co“After a day Federal Reserve President Jerome Powell Repeat his commitment to reining in Highest inflation rate in decadessuggesting that the central bank will raise interest rates when necessary to tame consumer prices.

“What we need to see is inflation coming down in a clear and convincing way, and we’ll keep pushing until we see that,” he said during a Wall Street Journal live event. “If it involves exceeding widely understood levels of neutrality, we will not hesitate at all to do so.”

Fed policymakers raised the benchmark federal funds rate by half a point earlier this month, and Powell promised that two increases of the same size would be on the table at the upcoming meetings in June and July. That sentiment was echoed on Tuesday as the Federal Reserve races to catch up with runaway inflation and bring it back to its 2% target.

“This was the worst-case scenario that I wish had not happened,” Ghabbour told the host. Stuart Varney Wednesday.

“To sum up, Powell made it clear yesterday that they [the Fed does not] Don’t bother with the market.

“They will try to bring down inflation and there is nothing they can do in terms of rates, ie, lower fuel costs or lower food costs.”

Inflation Rises 8.3% in April, Approaching Almost 40 Years

earlier this month, The Ministry of Labor revealed Year-on-year inflation eased for the first time in months in April, but rose more than expected due to supply chain restrictions, the Russian war in Ukraine and strong consumer demand that continued to keep consumer prices near their highest level in 40 years.

Eddie Ghabbour, co-founder of Key Advisors Group LLC, warns that the US is in “the biggest bubble of our lives”. (iStock / iStock)

Price increases were widespread: food prices jumped 1% during the month, marking the 17th consecutive rise for this indicator. The largest monthly increases were in dairy products (2.5%, the steepest monthly increase since 2007), meat, poultry, fish and eggs (1.4%) and cereals and bakery products (1.1%).

The slight slowdown in inflation came last month with energy prices down 2.7%, led by a 6.1% drop in gasoline (which had risen by a staggering 18.3% in the previous month as a result of the Russo-Ukrainian war).

According to AAA, gas prices have hit record highs in recent days.

On Wednesday, the national average for a gallon of gas was $4.56, up from the day before and New record.

“I find it very hard to believe that we are not going to pull back so dramatically and drop at least 30% in S&P,” Ghabbour said. “I don’t think the average person understands how bad the setup is now, especially with yesterday’s news.”

Get your FOX business on the go by clicking here

“This is the biggest bubble in our life and they are [the Fed is] It will suck the liquidity out of the system, and it will explode,” he stressed, before warning that “we are not even close to seeing what could happen.”

He continued, “I’m not saying it to scare anyone, I’m trying to make people aware of what’s going on under the hood.” “We have [a] The standard amount of corporate debt now.”

ribbon protection else they change they change %
Me: DJI Dow Jones averages 31490.07 -1,164.52 -3.57%
SP500 Standard & Poor’s 500 3923.68 -165.17 -4.04%
I: COMP Nasdaq Composite Index 11418.15432 -566.37 -4.73%

Ghabbour provided insight as US stocks opinion sharp sale Wednesday as more retailers revealed the negative impact of economic inflation.


Megan Heaney of FOX Business contributed to this report.

Leave a Comment