The Blubber

Per Business Insider

Elon Musk has expressed his worries about how the Federal Reserve could potentially affect the entire stock market's value. He says that the Fed needs to tread carefully, especially when it comes to having a rate that would exceed 6%.

During Tesla's Q4 earnings call, Elon Musk talked about the central bank's moves against inflation. He said that the Feds should tread carefully while expressing his concerns that the stock market could be at risk.

Musk also expressed how the Fed is at risk of affecting all equities, which would be extremely dangerous for the whole market. The S&P 500 lost 20% last year while officials hiked interest rates by 425 basis points.

Musk: "Why don't you put your money in T-bills or [a] savings account essentially instead of in the S&P 500, if the S&P 500 is variable and the bank interest rate is not?"

This is not the first time that the Tesla and Twitter CEO criticized the moves of the Feds. Musk previously also urged the Feds to cut interest rates immediately as they were increasing the "probability of a severe recession."

Big Short investor Michael Burry also gave his thoughts regarding how this year could turn out, saying the CPI is likely to drop further and that another inflation spike could happen. Burry also noted that the "Fed will cut and (the) government will stimulate."

Many experts are expecting a recession to happen in 2023. One example is Bank of America's Brian Moynihan, who says they are preparing for the worst as they expect a "mild recession" to happen, per CNBC.

Bank of America also noted that a recession could drop stocks by 24%. So far, the Fed funds rate sits at its highest level since 2008 at 4.25% to 4.5%.

See flow at unusualwhales.com/flow.

Other News:

• Elon Musk Said the Fed is 'Amplifying the Probability of a Severe Recession' Urging Them to Cut Interest Rates Immediately
• Michael Burry Gives 2023 Predictions: 'We Will Have Another Inflation Spike'

Resources:

Business Insider

CNBC