"BNP Paribas fund arm braces for ‘mother of all recessions’"

From Finanz.dk:

The chief executive of BNP Paribas Asset Management, one of Europe’s largest investment houses, has warned of the “mother of all recessions” as the fallout from the coronavirus pandemic hits economies around the world.

Frédéric Jambon poured cold water on the idea of a swift recovery from the pandemic following “a very, very substantial drop in activities in pretty much all of the economies in the world”.

The head of the €553bn investment house said a so-called V-shaped recovery was unlikely, instead forecasting a longer recessionary period before an uptick. “We have a view that the recovery will be more U shaped than V shaped in most countries,” he said.

He added that the rally in equity markets since a sell-off in March, when countries around the world went into lockdown, was not reflective of the underlying global economic conditions.

“The huge rally we have seen over the course of the few months from the low point in March is probably a bit fast and probably does not take into account the risk of a second wave,” he said, referring to the possibility of a further surge in Covid-19 cases globally.

He said investors — particularly smaller retail investors in the US and Europe — had been piling into the market because of “fear of missing out”, and low interest rates, which are hitting returns....

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