Cathie Wood Argues U.S. is Already in a Recession
- According to Cathie Wood, the ongoing Ukraine war is one of the geographical factors aiding the prevailing inflation.
Ark Innovation ETF (NYSE: ARKK) CEO Cathie Wood has acknowledged that she had dramatically underrated the gravity of inflation. Speaking during an interview with CNBC, Wood had undermined the severe implications of inflation before coming out to concede that the US economy is possibly in recession.
The CEO attributed the prevailing inflation on varieties of conditions, including supply chain disorder, and geographical factors. According to Cathie Wood, the ongoing Ukraine war is one of the geographical factors aiding the prevailing inflation.
Cathie Wood on the Market Outlook
She claimed these factors overtly inflicted heavier inflationary pressures on the economy than anyone could have expected. Additionally, she revealed the commencement of recession occasioned in part by misappropriated inventories.
In the interview with Ross Sorkin, Wood said everyone thinks the economy is undergoing a heavy recession. According to her, the perception that economic perception tends to be sustained is utterly wrong. The CEO clarifies that even though inflation remains a bigger problem, the “wrong” perspective only prone the economy to deflation.
Wood further clarified that supply chain issues have resulted in mismanagement of supplies by major retailers. This mismanagement has led to a surplus of certain finished goods like furniture that were market demanding during the pandemic. According to her, even well-supervised companies in the world are currently facing similar challenges.
She noted the rise in inventories witnessed in 2021 is hugely greater than the surges she has ever witnessed during her 45year career. Wood hinted at the problems facing Walmart, predicting more in the coming future.
The CEO further referenced a study by the University of Michigan, which indicated a massive drop in consumer sentiment. Wood believes the result from the survey further serves as an indication of the commencement of recession in the economy
The survey carried out by Michigan University suggested that consumer attitude in the highest income groups is lower than in the lowest groups. In a report made by MarketWatch last week, the closely watched record of consumer sentiment had plunged to 50 in its final reading for June.
As of publication time, ARKK is down approximately 5.88 percent in the past 24 hours to trade around $41.83, according to market data provided by MarketWatch. However, over $370million of funds had been recorded through money flow into the ETF over the past week.
Rebecca is a Senior Staff Writer at BitcoinWisdom, working hard to bring you the latest breaking news in the cryptocurrency market. In the words of Elon Musk “Buy stock in several companies that make products & services that *you* believe in. Only sell if you think their products & services are trending worse. Don’t panic when the market does. This will serve you well in the long-term.”
