“The Numbers Don’t Portend Well” - FedEx CEO
This may come as a surprise or shock to some, but not us. Just like we saw the years long buildup that caused the financial debacle in 2008, we have been expecting. and planning, for this for a pretty long time.
Therefor, we see opportunity.
The CEO of FedEx has issued a grim warning, saying that he believes a worldwide recession is looming after the company saw a sharp decline in shipping volume in recent months.
In an interview with CNBC on Thursday, FedEx CEO Raj Subramaniam said 'I think so' when asked whether the economy is 'going into a worldwide recession.'
'But you know, these numbers, they don't portend very well,' added Subramaniam, who blamed the company's dismal new profit projections on a broader decline in economic conditions.
Shares of FedEx plunged 23 percent at the opening bell on Friday, after the company said demand for shipping dropped sharply at the end of August and predicted that the slowdown would worsen in the current quarter.
FedEx shocked Wall Street on Thursday by scrapping its earnings forecast for its current fiscal year, which it had issued less than three months ago.
In response to a sharp decline in business, the company said it will cut costs by closing over 90 FedEx Office locations and five corporate offices, pausing new hiring and operating fewer flights.
“We are swiftly addressing these headwinds, but given the speed at which conditions shifted, first-quarter results are below our expectations” - Daily Mail
The US Federal Reserve is widely expected to deliver the third straight 75-basis-point rate hike at its policy meeting after recent data showed that inflation remains stubbornly high.
‘They Should Do 100”
Bloomberg, September 13, 2022 - Tuesday’s unexpectedly hot inflation reading virtually assured markets that the Federal Reserve will raise rates by 75 basis points next week. Wall Street then began to weigh the chance that the Fed might make a more dramatic statement.
The odds for a 100 basis point rate hike jumped more than 20% after the consumer price index showed an increase from July. With hopes of a “Fed pivot” firmly dashed, the S&P 500 Index tumbled as much as 3.2%.
Larry Summers, former Treasury Secretary and the President Emeritus of Harvard University, tweeted that if he was a Fed official, he would pick “a 100 basis points move to reinforce credibility.”
