Davos | Bridgewater Co-CIO: Financial markets are too beautiful to think about the Fed's interest rate cuts

Greg Jensen, co-chief investment officer of Bridgewater, joined other financial executives in warning that bets on a series of U.S. interest rate cuts could prove risky. Speaking at the World Economic Forum in Davos, Jensen said he was impressed and surprised by the resilience of financial markets in the face of the Fed’s continued interest rate hikes last year. He believes that asset prices reflect investors’ assumptions that inflation will soon fall, prompting the Fed to cut interest rates quickly. “The market is assuming a perfect scenario where lower inflation allows the Fed to ease policy without a recession,” Jensen said. "We’ve digested an almost perfect scenario, which is both impressive and worrying. ”