so they can weather a sudden wave of withdrawals, or survive a surge in late payments and defaults if recession strikes.
On the other hand, Siegel hailed a"truly Goldilocks situation for equities" in his commentary. He suggested that signs of a cooling labor market, coupled with hints from Fed officials that the central bank could skip a rate hike this month, were good news for stocks. Still, the markets guru predicted that joblessness would likely jump later this year as the Fed's previous hikes temper demand for workers. He also described the current rate level as a threat to the economy.
Siegel struck an even more negative tone in his commentary last week. He cautioned that lifting rates any higher might spur depositors to yank their cash from their bank accounts, and pile it into higher-yielding Treasuries and money-market funds instead. He also noted that regional banks, and the smaller businesses they serve, would likely suffer the most from those deposit outflows.
Experts are divided on the outlook for the housing market."Shark Tank" investor Barbara Corcoran has argued there's a load of pent-up demand, andMeanwhile, real estate billionaire Jeff Greene has warned of a"very frightening time in the entire real-estate industry" as households and businesses fall behind on their rent and mortgages, and struggle to obtain fresh financing as banks shy away from lending.