Wall Street vet and Bitcoin bull Mike Novogratz says the economy is going to ‘collapse’ and we’re heading into a ‘really fast recession’

While many economists agree a recession is likely coming in 2023, Wall Street veteran and Bitcoin bull Mike Novogratz has just given one of the most dire outlooks yet.

“The economy is going to collapse,” Novogratz told MarketWatch on Wednesday, adding, “We are going to go into a really fast recession, and you can see that in lots of ways.”

Novogratz, chief executive of crypto merchant bank Galaxy Digital, gave the interview just before the Federal Reserve raised rates by 0.75 percentage points—the largest rate hike seen since 1994. The rate hike came five days after U.S. consumer price increase unexpectedly surged in May to a 40-year high of 8.6%.

Novogratz pointed to the housing market, which is finally cooling down after a two-year hot streak, and inventories piling up as signs of a recession looming on the horizon.

“There are layoffs in multiple industries, and the Fed is stuck,” he said, adding that the central bank is in a position where it has to “hike [interest rates] until inflation rolls over.”

Novogratz accurately predicted in the interview that the central bank would lift rates by 75 points and that the market would rally on the news. After Fed chair Jerome Powell announced the rate hike, the Dow Jones Industrial Average rose by 1%, while the S&P 500 advanced 1.5% and the Nasdaq rose 2.5%.

Novogratz also predicted there would be a stock selloff in the next coming days, which happened right on cue. At 8 a.m. ET, S&P 500 futures were trading 2.2% lower, wiping out yesterday’s gains and plunging the benchmark further into a bear market.

“They are hiking into the popping of a bubble,” Novogratz said.

Recession looms

The U.S will officially be in a recession when the National Bureau of Economic Research (NBER) finds a significant decline in economic activity that lasts over an extended period of time—usually two fiscal quarters.

According to a new survey of 49 U.S. macroeconomics experts conducted at the start of June by the Financial…

Read more at finance.yahoo.com

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