Economist Henrik Zeberg Issues Dire Warning, Says Fed Cannot Stop Major Recession at End of 2024

A closely followed economist is warning that a major economic event last witnessed almost a century ago will likely rear its ugly head in 2025.

Henrik Zeberg tells his 140,700 followers on the social media platform X that he sees risk-on assets such as stocks and crypto going higher and higher for the next few months.

However, the economist predicts that the bullish conditions will abruptly subside toward the end of the year, just as market participants become extremely exuberant.

“You may not like it. You may not understand it.

But the bull market has an end date – this year! A blow-off top!

First US markets will explode higher. Crypto and small caps will soar as we see a rotation from large caps and foreign markets (outside the US).

Everybody will become euphoric and once again trust that the Fed will have our backs.

But a major recession will set in at the end of the year.” 

According to Zeberg, the Fed will try to support the economy by printing money to stimulate growth. But he says the Fed’s actions will only delay an economic collapse that will eventually give rise to stagflation – a period of slow economic growth with climbing unemployment and high inflation.

“Fed will intervene – yes – but will only create a bounce in markets, as they enter with monetary stimulus when recession and deflation stare them in the eyes.

They will offset stagflation!

Consequence: largest recession and bear market since 1929 in two stages. First deflation, then bounce, later stagflation.”

In January 2023, Zeberg predicted that the stock market would reach record highs before witnessing a sudden crash. At the time, the S&P 500 was trading at around 4,000 points and Bitcoin was worth close to $20,000.

At time of writing, the S&P 500 is hovering at 5,321 points and BTC is trading at $70,150.

Generated Image: DALLE3