On October 9, 2014 in Hawthorne, Calif., Tesla Motors CEO Elon Musk unveiled a new all-wheel-drive version of the Model S.
Lucy Nicholson | Reuters
Elon Musk believes a recession is coming and worries that the Federal Reserve’s attempt to bring inflation down could make things worse.
In a tweet early Wednesday morning, Tesla’s CEO and Twitter owner called on the Fed to “cut interest rates immediately” or risk “increasing the likelihood of a deep recession.”
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The remarks were made in an exchange with Tesmania co-founder Vincent Yu, joined by several others.
Later in the thread, NorthmanTrader founder Sven Henrich argued that the Fed “had been too easygoing for so long that it completely misread inflation, and now doesn’t even consider the lag effect of these rate hikes.” In addition, we have aggressively tightened our debt mix to a record high.” It’s too late to realize the damage done. ”
Mr. Musk replied, “Exactly.”
This is not the first time Mr. Musk has warned of impending economic doom.
In a similar exchange on Oct. 24, the world’s richest man estimated that a global recession could last “until the spring of 2024,” though he said it was “only speculation.” The forecast comes amid a host of economic warnings from other corporate executives, including Amazon CEO Jeff Bezos, JP Morgan CEO Jamie Dimon and Goldman Sachs CEO David Solomon. It was held in.
The Fed appears to be entering the final stages of a rate hike campaign aimed at combating inflation that remains near the highest in more than 40 years. The central bank is expected to raise the benchmark rate six times this year, raising the overnight borrowing rate to a target range of 3.75% to 4%, and several more times before halting.
In recent days, Fed officials have said they expect a fourth consecutive 0.75% gain, and expect the latest rally to be smaller than the one that took place in early November. Fed Chairman Jerome Powell is scheduled to speak at the Brookings Institution on Wednesday afternoon.
