Elon Musk says he's worried about the Fed 'crushing' the value of the entire stock market
Elon Musk is worried the Federal Reserve could ravage the stock market by jacking up interest rates too high.
The Tesla CEO delivered his concerns to investors on the electric vehicle maker's fourth-quarter earnings call on Wednesday. "I think the Fed needs to be very cautious about having a Fed rate that potentially exceeds 6%," Musk said at Tesla's fourth quarter earnings call, referring to the central bank's aggressive fight against inflation.
Officials hiked interest rates 425-basis-points last year in order to combat rising prices, a move that drovewhile pushing bond yields higher. Musk said on the call that he's worried that rates will soon exceed the average return of the S&P 500 if the Fed pushes interest rates past 6%. "Why don't you put your money in T-bills or [a] savings account essentially instead of in the S&P 500, if the S&P 500 is variable and the bank interest rate is not?" he said."The Fed is at risk of crushing the value of all equities. Quite a serious danger."
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