Despite stocks nearing their record highs from February, an influential analyst, Anatole Kaletsky, said that the longer-term outlook remains dark.
To be sure, Kaletsky has been bearish for months and also concedes that stocks could climb to fresh highs in the near future–a so-called double top for the bull market. But he still thinks a recession as a result of President Donald Trump’s tariffs is likely, and could also coincide with a big surge in inflation.
The market may still be going up now just because of momentum, and the popularity of “buy the dip” strategies that have been popular for years. Or investors may really believe in the TACO trade–that Trump Always Chickens Out–even though all signs are that there will still be substantially higher tariffs once they’re finalized than before.
