Citadel CEO Ken Griffin says inflation may have peaked, but a recession is coming. The CEO warned that “these are very uncertain times for investors,” adding that the Federal Reserve is “facing levels of inflation we haven’t seen in a long time.”
Citadel’s Ken Griffin talks about the U.S. economy, inflation, recession, and cryptocurrencies
Kenneth Griffin, founder and CEO of global investment firm Citadel, shared his views on a variety of topics including the U.S. economy and cryptocurrencies at the CNBC Delivering Alpha conference on Wednesday.
“It is a very uncertain time,” he began.
“We are grappling with the threat of nuclear war in Ukraine,” he added. We also face unprecedented central bank intervention. In the United States, we are experiencing record high inflation in our lifetime. These are very uncertain times for investors,” Griffin stressed.
Noting that the U.S. stock market has shown “some resilience” and that the U.S. economy “remains strong,” he argued that.
The peak in inflation has probably just occurred or is about to occur. So the future trajectory on many important fronts is likely to be somewhat better domestically, assuming there are no major impediments abroad.
As to whether the U.S. economy will fall into recession, he offered the following observation.
“Everybody likes to predict a recession, and it will happen eventually, but the question is when and, frankly, how severe.
The Citadel boss continued.
“And is there a chance of a hard landing at the end of 23 years? Of course.” He went on to say that his investment firm is “very focused on the possibility of a recession” as part of its risk management.
“The Fed is wrestling with levels of inflation that we haven’t seen in a long time. They have a very limited toolkit,” Griffin stressed, warning that the Fed could raise interest rates, but with “very adverse consequences” for homebuilders, automakers, and others. However, the executive believes that “the American consumer feels absolutely good about the situation right now.”
The Citadel founder went on to talk about Europe. He said, “There is a war going on in Europe. There is record inflation,” he said, adding.
Europe is probably already in a recession because of the high cost and scarcity of energy.
Nevertheless, he noted that although the market is falling, “if you look at the news headlines, it probably hasn’t fallen as far as you think.”
Griffin was also asked about cryptocurrencies.” There’s a generational struggle here,” he began.
“Ironically, for good reason, including a certain libertarian worldview. The Citadel CEO explained.
As government gets bigger and bigger, certain people, you know, I want privacy… They feel like they want to get away from the government.
“It’s interesting to see people move away from big government when you look at assets like cryptocurrencies like this, and it’s really ironic given that people see that government can solve so many other problems,” he concluded.
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