JPMorgan Advises Investors to Sell Crypto, Buy Value Stocks – Says Fed Overestimates Strength of US Economy – Markets & Prices Bitcoin News

The global chief strategist of JPMorgan Asset Management has advised investors to focus on valuations, invest in value stocks, sell crypto and avoid bitcoin. “The Federal Reserve overestimates the strength of the US economy as it feels guilty about the fact that inflation went up under their watch,” he said.

JPMorgan Strategist’s recommendations

JPMorgan Asset Management’s global strategist, David Kelly, has some advice on what investors worried about a hawkish Federal Reserve should invest in.

After Federal Reserve Chairman Jerome Powell’s speech on Friday in Jackson Hole, Wyoming, he was quoted as saying:

The economy has got one foot into a recession and the other on the banana peel now.

“We are taking strong and swift steps to moderate demand so that it comes more in line with supply, and to keep inflation expectations anchored. We will continue to do that until we are sure the job is done, Powell said last week.

Kelly warned of more volatility ahead, stressing that investors should focus on defensive plays and valuations rather than short-term direction, such as investing in value stocks, long-term bonds and income-generating options.

The strategy recommended that investors sell crypto while staying away from major tech stocks and bitcoin:

Make sure you overweight US and international stocks, as well as stocks with relatively low price-to-earnings ratios.

Citing a high risk of recession, Kelly said the economy will “feel more normal” by the end of next year. He cautioned, however, that the real question is “how much damage does the Fed want to inflict on this economy?”

The global chief strategist of JPMorgan Asset Management further said:

The Federal Reserve overestimates the strength of the US economy as it feels guilty about the fact that inflation rose under their watch.

Kelly also said Monday that the U.S. economy will “teer on the edge of recession” until the Federal Reserve gives up its fight to tame inflation. He expects the Fed to raise the federal funds rate to a range of 3.75%-4% by the end of the year, from 2.25%-2.5% currently. “The Fed can then stop walking and hope that the economy will just avoid recession,” he described.

JPMorgan CEO Jamie Dimon warned earlier this month that “something worse” than a recession could be coming. In June, the director said an incoming economic hurricane, and advised investors to prepare.

This week, Goldman Sachs urged investors to buy commodities and worry about the recession later. The Goldman analysts emphasized that “equities could suffer as inflation remains high and the Fed is more likely to surprise on the hawkish side.”

What do you think of the recommendations of JPMorgan Asset Management’s global strategist? Let us know in the comments section below.

Kevin Helms

A student of Austrian economics, Kevin found Bitcoin in 2011 and has been an evangelist ever since. His interests lie in Bitcoin security, open source systems, network effects and the intersection of finance and cryptography.