Cathie Wood Rejects Fed's Inflation 'Jawboning,' Pivots Back To Deflation Narrative

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Wall Streets renteforhøjelser har skabt kaos på højvækstteknologiske aktier - og Cathie Woods Ark ETF'er var igen front og centrum for skaden.

Still, Wood dismissed concerns over inflationary pressures, reaffirming an earlier assertion that deflation remains the focus for her firm during a webcast on Tuesday. The Ark Invest CEO also said that price increases were likely to ease as supply chain issues resolve.

Wood’s remarks come amid Federal Reserve Chair Jerome Powell’s confirmation testimony on Tuesday, in which he signaled that if the pace of price increases fails to slow, the central bank will get more aggressive with raising short-term borrowing costs.

Ark Invest’s beleaguered innovation fund (ARKK) has now lost half its value from its peak as worries of more aggressive monetary policy by the Federal Reserve sent technology stocks — namely the “disruptive” but often unprofitable picks that form her investment strategy — cratering to start the new year. Even as the fund rode a tech rebound on Tuesday to eke out a modest comeback, ARKK is down more than 50% from it’s all-time high in February 2021. ARKK ended the session 2.46% higher to close at $86.98 per share.

I en separate webcast on Jan. 7 addressing the recent rate rout, Wood maintained her view that losses were temporary, even stating that Ark Invest anticipates “inflation is indeed transitory,” based on other economic measures such as velocity — the ratio of GDP to money supply — which has decelerated since its peak at the onset of the pandemic.

"Det, vi tror er sket her, er, at Fed, efter at have antydet, at inflationen var forbigående siden begyndelsen af coronavirussen, blev bekymret, da den så CPI-inflationen år-til-år på 6.8 %, og den ønsker ikke at blive bebrejdet for, at inflationen opretholdes og bestemt ikke bevæger sig ud af kontrol,” sagde hun i videoen.

"Vi synes, det er lidt kæbeudbening her," tilføjede hun. "Fed ønsker at tage fejl af høgeagtighedens side, bestemt fra et kæbeudbeningssynspunkt, fordi de ikke ønsker, at inflationen skal fortsætte med at eskalere."

Woods jævnaldrende på Wall Street ser ikke ud til at dele den tillid. Selvom nogle har forudsagt, at priserne kan udjævnes ved årets udgang, er der mange, der forbereder sig på, at inflationen kan blive ved.

Goldman Sachs, Evercore ISI, and Deutsche Bank are among Fed watchers repricing the Federal Reserve’s pace on rate hikes, predicting short-term interest rates will be 100 basis points higher by the end of 2022 than where they are now.

JPMorgans administrerende direktør Jamie Dimon sagde i et interview med CNBC mandag, at han håbede på en "blød landing" fra Fed, men erkendte, at inflationen kunne være værre, end politikerne forventer, og renterne kan blive øget mere end i øjeblikket udført.

I modsætning hertil, selvom hendes fond bærer hovedparten af det Fed-ansporede udsalg, sagde Wood, at hendes "overbevisning ikke kunne være højere", at hendes foretrukne innovationsvirksomheder "vil fortsætte med at forårsage eksplosiv vækst - som vi har" ikke set i vores liv."

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Alexandra Semenova er reporter for Yahoo Finance. Følg hende på Twitter @alexandraandnyc

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