/perspectives/media/more-downside-risk-for-markets-in-the-near-term

More Downside Risk for Markets in the Near Term

Scott Minerd, Chairman of Investments and Global CIO, explains on CNBC why investors should stay on pause for now.

March 16, 2020

 

Key Takeaways:

  • Expect economic disruptions resulting from lost income as people stay home.
  • Swift and accommodative fiscal policy is necessary to avoid slipping into a global depression.
  • Don’t think of bailouts as charity—the government made money on TARP as a distressed investor.
  • While global depression is now a 10–20 percent risk now, weakness in peripheral sovereign markets could to be the tipping point.
  • While high-yield and investment-grade bonds have only been cheaper relative to Treasurys 15 percent of the time, the balance of risks remains to the downside.


Read Global CIO Outlook: Meeting An Historic Challenge


FEATURED PERSPECTIVES

May 20, 2020

Reaching the End of the Runway

While the U.S. speculative-grade default rate could reach 15 percent in this cycle, the market is offering better entry points than seen in years.

May 10, 2020

We Are All Government-Sponsored Enterprises Now

The support to corporate America during this economic shutdown risks the creation of a new moral obligation for the U.S. government.

April 26, 2020

Prepare for the Era of Recrimination

The unintended consequences and moral hazard of insufficient and misdirected policies.


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