Billionaire investor Steve Cohen has warned of an impending slowdown in U.S. economic growth, coupled with a “significant correction” in the markets. Speaking at the Future Investment Initiative Institute summit in Miami Beach, Florida, Cohen pointed to several factors contributing to this outlook, including tariffs, reduced immigration, and cuts to government spending. He suggested that these policies, particularly those implemented by the Trump administration, could lead to a cooling of economic growth and a potential slump in stocks.
Cohen, the founder of Point72 Asset Management, expressed concern over the negative impact of tariffs, which he described as taxes that could trigger retaliatory measures from other countries. Additionally, he noted that slowing immigration would hinder labor force growth, further dampening economic prospects. Cohen also criticized the White House’s DOGE office, framing its efforts to cut government waste as a form of austerity that could negatively affect the economy by reducing the flow of money.
Looking ahead, Cohen’s team anticipates U.S. economic growth to decelerate from 2.5% to 1.5% in the second half of the year, with unemployment expected to drop due to slower workforce expansion. He described the current economic environment as a mix of sticky inflation, slowing growth, and government austerity, leaving him more pessimistic than usual. While Cohen does not foresee a “disaster,” he expects a substantial market sell-off and believes the best investment gains may already be behind us.
— news from Business Insider