Virtus Capital President: Market Could Fall 50% If This Happens
Steven Gidumal warns that “Socialists” could sink the market.
Virtus Capital managing partner Steven Gidumal warned that markets could tank should America elect Bernie Sanders, Elizabeth Warren or Pete Buttigieg.
“If a Socialist is Elected, the Market will sell off BIG,” Gidumal said, according to CNBC. “Pick a Socialist – Bernie, Liz, Pete. etc. and the Market would sell off.”
During a presentation at the annual Distressed Investing Conference in New York, Gidumal had little positive to say about the front runners in the Democratic party. The presentation centered on expectations for the distressed asset market in the year ahead. He said that 2020 could be very choppy for investors. Although he doesn’t anticipate a recession in 2020, he said, “it will probably hit” in Q1 2021.
Virtus Capital and What Lies Ahead
Virtus Capital is a hedge fund that specializes in capital restructuring and distressed assets.
He said that he thinks the markets anticipate the re-election of President Donald Trump. He also praised Trump for his ongoing criticism of the Federal Reserve.
“One of the best things the administration has done across all the parties is jawboning the Fed to keep interest rates down,” he said.
At the end of his presentation, Gidumal said he thinks that the Fed wants to hike interest rates. He also said that the Fed might aim to raise interest rates before next November’s election.
“I think Trump is absolutely right to bash the Fed and to do it publicly because a lot of what they do is irrational and has been for the past century,” Gidumal said.
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