LVMH CEO fears ‘scary’ global crisis – but long-term optimist
Bernard Arnault, CEO of the world’s largest luxury group Moët Hennessy Louis Vuitton (LVMH), has weighed in on the global economic outlook, describing it as “scary”.
He told CNBC: “For the economic climate, the present situation is… mid-term scary. I don’t think we will be able to globally avoid a crisis when I see the interest rates so low, when I see the amounts of money flowing into the world, when I see the stock prices which are much too high, I think a bubble is building and this bubble, one day, will explode.”
Despite Arnault’s fears, LVMH is having a fantastic year
SOURCE: Yahoo Finance
Mr. Arnault doesn’t have a date in mind for this crisis – it could be imminent, or it could be years away – but he is certain one is due. Almost a decade after the global financial crisis of 2008, he claims to see a pattern:
“There has not been a big crisis for almost ten years now and since I’ve had a business I have seen crises more than every ten years, so be careful.”
Many readers will be noting that Mr. Arnault is gloomier than most in the market seem to be at present. 2017 has – thus far – been a positive year, with the S&P 500 having hit its average annualized total return (well, 9.7% - the average annual return is 9.8%) in just under half a year.
But, if the luxury magnate is pessimistic about the future, it is only the short-to-medium-term future. Long-term, Arnault told CNBC that he was “optimistic” about advances in technology and innovation stimulating the economy.
Dominion holds LVMH in its Global Trends Luxury Fund.
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