Levy Says Epidemic to Test Fragile Global Financial Pyramid
MOUNT KISCO, N.Y., Feb. 26, 2020 (GLOBE NEWSWIRE) -- David A. Levy wrote to clients in the February 2020 issue of The Levy Forecast® that “the global economy is fragile but supported by powerful financial drivers, so the focus is on whether the shaky structure can survive the stresses and strains to its critical foundations, namely profitability, financial stability, and market confidence.”
The chairman of the independent Jerome Levy Forecasting Center LLC ( www.levyforecast.com ) stated that, “investors appear more desperate than perhaps ever before to chase returns and ignore risk—not so much driven by greed and expectations of big gains as by fear of not securing any meaningful returns.”
Writing in a publication devoted to forecasting and analyzing economic and business conditions since 1949, Levy cited his recent white paper, “Bubble or Nothing,” which explains how long-term, macro changes to the economy’s financial structure have driven down rates of return and pressured investors and lenders into increased risk-taking (this paper is complimentary and publicly available at www.levyforecast.com/bubble-or-nothing ). Levy stressed that these pressures give risk assets extraordinary potential to rally on market weakness and to perpetuate bull markets, but that “the obstacles to [the global] expansion have also become greater.”
Levy ended with a warning that although many analysts have downplayed the virus epidemic impacts, “at best, the economic effects of COVID-19 outbreak are likely to be much worse than widely anticipated.”
About The Jerome Levy Forecasting Center LLCThe Jerome Levy Forecasting Center LLC is an independent economic research and consulting firm that has been specializing in using the macroeconomic Profits Perspective in economic analysis and forecasting for seven decades. The goal of the Levy Forecasting Center is to improve its clients’ business and investment performance by providing them with powerful insights into economic risks and opportunities – insights that are difficult or even impossible to achieve with conventional approaches to macroeconomic analysis. Additional information may be found at www.levyforecast.com.
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