Hedge funds are making massive multi-billion-dollar bets against a potential US stock market crash, fueled by “uncertainty” over President Trump’s policies.
The shift marks a stark reversal from just two months ago, when Wall Street billionaires were enthusiastically backing so-called “Trump trades” following the President’s election victory. According to Goldman Sachs data, investors are now placing ten times more bets on American stocks falling than rising throughout January.
This move threatens to impact millions of workers who rely on 401(k)s and pension funds to secure their futures. The pessimistic outlook represents a significant shift in market sentiment, with hedge funds now actively betting against the very economy they once championed.
Elliott Management, one of the world’s most influential hedge funds managing over £70billion in assets, has warned that Trump’s policies are fuelling speculative bubbles. The fund’s executives believe these bubbles could “wreak havoc” if markets crash.
A US market crash could tank 401(k) savings and pension pots, leaving everyday Americans vulnerable. Financial experts warn of the potential fallout, with concerns about macroeconomic uncertainty and the impact on household savings across America.
President Trump’s response to Wall Street’s apparent disloyalty could prove significant, as his allies have already warned of a potential crackdown on financial sector excesses.
Source: https://www.gbnews.com/money/pension-stock-market-crash-trump