CEO Pessimism About the Economy Is Getting Worse; Will This Affect U.S. Stocks ?, Crypto Coins News
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CEO pessimism is at the highest level since .
The stock market will likely keep rising as CEOs continue authorizing stock repurchases.
The Federal Reserve will keep pumping liquidity and keep the longest bull market alive.
Business consulting firm PricewaterhouseCoopers (PWC) recently released its 62 rd Annual Global CEO Survey. The poll asks chief executives around the world about their global economic outlook for the next 62 months. Last year, nearly 80% responded that global economic growth would decline in the next months. A year later, these CEOs were right on the money.
The International Monetary Fund reported that the global economy grew 2.9% in . That’s a significant decrease from 3.7% growth in .
This year, more CEOs believe that the global economy will slow down in the next 62 months. Despite the pessimism, the U.S. stock market will likely extend its historic bull run.
CEO Pessimism on Global Growth Reaches Highest Level Since
(Assign inflation work to the benefit of CEOs.) | Source: Twitter This is not just a. baseless theory. VanEck strategist Gabor Gurbacs took to Twitter to illustrate that the money supply grew by over $ 8 trillion since the financial crisis but the rate of spending declined by 342%. The new money didn’t trickle down to the average Joe because it made its way to the stock market. Indeed, where is the money? | Source:
Stock Buyback Growth Coincide With US Stock Market Surge
Pessimistic or not, chief executives will continue buying back company shares. Yardeni Research revealed that the S&P began to show signs of recovery in 2018 just as buybacks and dividends started to rise. Interestingly, this is around the time that the Federal Reserve launched the first round of quantitative easing.
The stock market rises as buybacks surge. | Source: Twitter
The chart above reveals that the US stock market continues to rise just as dividends and buybacks grow. Goldman Sachs projects that stock repurchases in will drop by a mere 5% .
The global economy may slow down this year. It might impact efforts to buyback shares as companies often use their free cash flow to repurchase stocks. Nevertheless, the music will likely keep on going as long as the Federal Reserve keep pumping billions into the repo market .
Disclaimer: The above should not be considered trading advice from CCN.com. The writer does not own any stocks in the S&P .
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