Carl Icahn says the market over the long run will certainly ‘hit the wall’ because of money printing

Longtime activist investor Carl Icahn stated Monday that the U.S. markets might see main challenges over the long run within the face of extreme cash provide and rising inflation.

“In the long term we’re definitely going to hit the wall,” Icahn stated Monday on CNBC’s “Fast Money Halftime Report.” “I actually assume there can be a disaster the best way we’re going, the best way we’re printing cash, the best way we’re going into inflation. When you go searching you, you see inflation throughout you and I do not understand how you take care of that in the long run.”

The Federal Reserve and Congress have unleased trillions of {dollars} in stimulus to rescue the economic system from the Covid-19 pandemic. The central financial institution’s steadiness sheet swelled by greater than $3 trillion amid its open-ended quantitative easing program, whereas the federal government has allotted over $5 trillion in stimulus to help People by the well being disaster.

Icahn was adamant about not making a market timing name, however he believes sooner or later over the long run the markets can pay the worth for these insurance policies.

On the again of those unprecedented stimulus packages, the S&P 500 has quickly worn out the pandemic-induced losses and rebounded to a brand new excessive. The fairness benchmark is up greater than 19% in 2021, sitting simply 1.4% under its all-time excessive reached early September.

The huge cash provide has partly contributed to rising value pressures within the economic system. Inflation ran at a fresh 30-year high in August amid provide chain disruptions and terribly robust demand.

The core private consumption expenditures value index, which excludes meals and vitality prices and is the Fed’s most popular measure of inflation, elevated 0.3% for the month and was up 3.6% from a yr in the past.

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