Famous investor Carl Icahn declared that Thursday’s relief rally didn’t alter his pessimistic assessment of the market and that a recession is still imminent.
Icahn said on CNBC’s “Closing Bell Overtime” on Thursday, “We maintain our portfolio hedged.” “I’m still very, very pessimistic about what will happen. Even if a rally like this one is undoubtedly dramatic, I still believe we are in a bear market.
Following October’s reading on consumer prices, which encouraged speculation that inflation has peaked, stocks made a significant rebound. Since May 2020, the Dow Jones Industrial Average has not increased by more than 1,200 points in a single day. The S&P 500 experienced a 5.5% increase, the largest gain since April 2020.

According to Icahn, huge bear-market rallies frequently occur due of the significant buildup of short interest during the downturn. The founder and chairman of Icahn Enterprises believes price pressures are worse than most people realise because of wage increases, despite the fact that the inflation data indicated some signs of easing.
Icahn stated that inflation “is not going away, not in the near term.” “Wage inflation is going to increase. Many people are reluctant to labour.

Icahn claimed that a recession is unavoidable because of rising interest rates and an inverted yield curve.
In contrast to the respective forecasts from Dow Jones, which called for increases of 0.6% and 7.9%, the consumer price index gained 0.4% for the month and 7.7% from a year ago. In an effort to reduce inflation, which is currently at its highest levels since the early 1980s, the Federal Reserve has been implementing a series of dramatic interest rate increases.

Icahn stated, “I believe the Fed took the necessary action. “I believe they raised interest rates too late in the game. However, I don’t believe the inflation is over. I was alive during the 1970s. The process of finishing it took a very long time. You can’t simply wave a magic wand to end inflation.