May 18, 2024

‘Financial guru forecasts massive stock market correction in US’

Grant Cardone, a seasoned private equity fund manager, has issued a stark warning about an imminent stock market crash that could see values halve, potentially wiping out the retirement and savings of millions of Americans. The Dow Jones’ recent gains notwithstanding, Cardone highlighted the alarming trend in the S&P’s yield curve, which has been inverted for over 500 days—a historical precursor to significant market downturns including those in 1929, 1974, and 2009.

In a recent statement on the social media platform X, Cardone outlined the dire consequences of such a crash, compounded by current inflation rates, which could effectively amplify total losses to feel more like 75%.

“WARNING: Stock Market is due for 50 percent correction taking S&P below 2674,” he cautioned, emphasizing the risk to retirement accounts heavily invested in the stock market at these levels, a Daily Mail report said.

Cardone, who has advised companies such as Google and Morgan Stanley, drew parallels between the current market indicators and those that preceded major financial crises in the past. He explained that following the historical crashes, the market declines erased significant value from Americans’ 401Ks, affecting their long-term savings and financial security.

The financial expert also criticized the Federal Reserve’s recent rate hikes, arguing that they have stifled the housing market rather than controlling inflation as intended. “Fed Chairman Jerome Powell has not controlled inflation. He has failed miserably,” Cardone said. He suggests that reducing interest rates might rejuvenate the housing market, encouraging more sales and potentially lowering house prices.

To safeguard against potential financial turmoil, Cardone recommends transitioning retirement funds from stock market-dependent 401ks to real assets that generate consistent cash flow, such as property investments. He believes this strategy could provide retirees with a more stable and reliable income source.

This warning comes as Manhattan sees a drop in rents for the first time since the pandemic, signaling potential shifts in the real estate market that could offer investment opportunities amid economic uncertainties.

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