The US stock market is experiencing a bloodbath in April as Trump’s tariffs spread across the global trade sector. The White House imposed tariffs on 185 countries, including an island inhabited only by penguins and no humans. The markets reacted strongly to the tariffs with Dow Jones down nearly 10% this month. However, the market experienced a sudden bounce on Monday but investors remain fearful of a bull trap. BlackRock CEO Larry Fink warned traders not to be fooled by the bounce and predicted that another 20% market crash is on the way.
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BlackRock CEO: 20% Market Crash & Recession Incoming
In a recent interview with Bloomberg, BlackRock’s Fink forecasted that a 20% market crash followed by a recession is incoming. He stated that the crash could be a buying opportunity for long-term investors. “I would say in the long run, this is more of a buying opportunity than it is a selling opportunity. That doesn’t mean we can’t fall another 20% from here too,” Fink said.
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He added that most of the executives in his circle believe that the US is already in a recession. “Most CEOs I talk to would say we are probably in a recession right now,” he said. The BlackRock CEO cautioned investors not to get carried away when the market recovers as it could represent a bull trap that leads to a crash.
If the market faces a 20% crash from here, according to BlackRock, Dow Jones could fall to the 30,000 range. It would constitute a disaster that could spill into the global stock and commodity market. The global markets have already seen the erosion of wealth worth trillions of dollars and a 20% fall from here would be devastating. It’s best to take an entry position when the bottom is near as going all in now poses a risk.
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