Tesla CEO and Twitter chief Elon Musk says the Federal Reserve’s recent rate hikes “will go down in history as the most damaging on record.” The billionaire has urged the Fed to cut interest rates immediately, emphasizing that the US central bank is “hugely increasing the likelihood of a serious recession”.
Elon Musk on Fed rate hikes
Elon Musk, boss of Tesla, Spacex and Twitter, warned on Thursday about the damaging consequences of the Federal Reserve’s rapid rate hikes.
His warning was an answer to one tweet by former investment manager Genevieve Roch-Decter stating that “the Fed has never raised rates faster” than this year. Musk wrote:
At the risk of being repetitive, these Fed rate hikes could go down in history as the most damaging ever.
Roch-Decter also included a chart in her tweet showing that the Fed has hiked rates further and faster this year than at any other time in modern history.
Many people agreed with Musk. “I agree, Elon. The mortgage industry is taking a bloodbath. Good professionals like me (marketing) have been fired. Applications at historic low. This is a disaster,” one Twitter user wrote. Another described: “This is what happens when the government artificially pumps $3.5 trillion into the US economy. The Fed is making up for it with damaging rate hikes… It’s only going to get worse.”
Musk also blamed the Federal Reserve for Tesla’s loss of market value. Investment adviser Ross Gerber tweeted last week: “Elon has now cleared $600 billion in Tesla wealth and still nothing from the Tesla BOD [board of directors]. It is completely unacceptable.” Musk replied:
Tesla is performing better than ever. We have no control over the Federal Reserve. That’s the real problem here.
The billionaire has warned several times about the risks of rate hikes by the Federal Reserve. Earlier this month, he warned that the recession will be massively strengthened if the Fed raises rates again. The central bank then raised interest rates by 50 basis points after four consecutive 75 basis point increases.
Last month, Musk warned that the “trend is concerning,” stressing that the Fed “needs to cut interest rates immediately.” He added: “They greatly increase the likelihood of a serious recession.” The billionaire also previously said he believes the recession will last until spring 2024.
What do you think of Tesla CEO Elon Musk’s warning about the Fed’s rate hikes? Let us know in the comments below.
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