'The earnings profit recession is real,' says Mike Wilson, Morgan Stanley's chief U.S. equity strategist.
Morgan Stanley's Mike Wilson is sticking by his bear call — and isn't changing his mind about an earnings recession."The mistake was not the Fed tightening last year. The mistake was … the timing of the fiscal policy stimulus, which overheated the economy last year."
Indeed, optimism has reigned so far this year. The S&P 500 has had its best start to a year since 1998. The index gained 13.1 percent in the first quarter — its strongest quarterly performance since 2009. "The risk is that the profits recession turns into corporate behavioral change, which then leads to further economic slowdown," Wilson warned on"Closing Bell."
"They are actually concerned," he added."Confidence … was pretty weak in the fourth quarter last year, and they want to make sure it doesn't tip over to a recession."
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