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“ ‘This could be President Trump’s Hurricane Katrina.’ ”
That’s Anthony Scaramucci, former White House communications director and founder of SkyBridge Capital, talking in an interview on Yahoo Finance on Thursday morning about what he sees as an inadequate response by the president to the coronavirus outbreak.
Back in 2005, the government, with President George W. Bush in the White House, was roundly criticized for mismanagement and lack of preparation in the response to Hurricane Katrina. The head of emergency operations for the city of New Orleans slammed FEMA as a “national disgrace.”
“You gotta be very careful in a crisis not to overreact, but you also have to be careful in a crisis not to underreact,” Scaramucci said, calling the comments Trump made in an interview with Fox News host Sean Hannity on Wednesday a “woeful underreaction.”
As for what the current climate means for the stock market, Scaramucci said he’s in the “most defensive position” he’s been over his three decades in the business. “I don’t like what I see,” he explained. “We’re in late-cycle economic expansion, which is fading. Production numbers are down. We’ve decided to put on heavy deficit spending. We’ve lowered rates a couple of times.”
At this point, he says he could “easily” see another 15% drop from here, particularly as the economy gets hit with a coronavirus-induced slowdown.
At last check in Thursday’s rough trading session, the Dow Jones Industrial Average DJIA, -3.80% was down more than 900 points, with the S&P 500 SPX, -3.65% and Nasdaq Composite COMP, -3.19% also deep in negative territory.
Watch the full interview:
