Tim Seymour is the founder and Chief Investment Officer of Seymour Asset Management. It aims to provide clients with asset management and wealth management services, including direct investment and allocation to private equity and alternative assets.
Seymour, a market expert and co-host of "Fast Money" on CNBC, joined Benzinga's "PreMarket Prep" live show, which airs every morning during the premarket session, on Friday.
The following are questions and commentary from Seymour and the show hosts: Dennis Dick, Joel Elconin and Money Mitch.
Seymour: This morning, Japan learns that they have a 2.5% inflation rate; Japan has suddenly become the one place in the world where there is no inflation, and the Bank of Japan (BOJ) is on planet Mars, or not even in this universe in terms of their approach in interest rate targeting, what they’ve addressed in terms of inflation, the currency dynamics there — and I don’t want to get too lost on Japan; but, there are so many links in this chain and so many central banks in the world has followed the Federal Reserve. In a market context, I think there is more pain to go.
Though, it is not all doom and gloom. I think there are market elements that have worked so far; it’s been efficient. So, I think we’ve priced in an enormous amount of recession, especially in banks.
Dick: I mean, Tim, look at our banks. Look at Wells Fargo & Co (NYSE:WFC) and Citigroup Inc (NYSE:C) — they passed the stress test [on Thursday], and that’s good news; maybe there are going to be some capital allocation plans coming Monday.
But, I think you hit the nail right on the head; I think a lot of these stocks have priced in that we are going into some type of a recession.
Mitch: Let’s dive into emerging markets. One of the areas I’ve been focusing on is what is happening in China. We’re starting to see what looks to me like some bottoming in tech stocks. How do you see China now?
Seymour: It’s fascinating; typically, emerging markets bottom first, right? So, they’re the ones that sell-off first. In a world of technology companies that clearly know no bounds, China has been reeling in those tech companies that have flown ahead of the government. So, is that over? I think the worst of it might be over for a little while.
Elconin: Tim, I have to get your take on one more thing; we have a significant geopolitical situation [Russia-Ukraine] that we can’t control. How do you incorporate something like that into your investment strategies?
Seymour: I think geopolitics is always a challenge and always, on some level, not really the ingredient that is the most critical to your investment allocation. Russia/Ukraine is horrific; it’s had an impact on the world in an economic sense. What we’re concerned about is central bank dynamics — we’ve created a monster that Fed Chair Jerome Powell has to control. This is a really interesting time to be allocating money to the markets.
Watch the full interview here:
