A global recession could be set in motion by the conflict in the Middle East as the humanitarian crisis compounds the challenges facing an already precarious world economy, two of Wall Street’s biggest names have warned.

The downbeat comments come as the City braces for another gloomy update on the UK economy, with the Office for National Statistics due to provide an update on how it fared during the third quarter on Friday.

 

After barely growing during 2023, the UK economy is again expected to be almost at a standstill, according to estimates by City economists. There are also new downbeat figures on the housing market, with UK mortgage lending predicted to show decade-low growth during 2023 and 2024.

In terms of the global economy, Larry Fink, chief executive of the world’s largest asset manager, BlackRock, said a combination of the Hamas atrocities of 7 October, Israel’s resultant attack on Gaza and Russia’s invasion of Ukraine last year had pushed the world “almost to a whole new future”.

In an interview with the Sunday Times, Fink said: “Geopolitical risk is a major component in shaping all our lives. We are having rising fear throughout the world, and less hope. Rising fear creates a withdrawal from consumption or spending more. So fear creates recessions in the long run, and if we continue to have rising fear, the probability of a European recession grows and the probability of a US recession grows.”

Jamie Dimon, the chair of America’s biggest bank, JP Morgan, also told the same newspaper that the combination of Israel’s war on Hamas and Russia’s invasion of Ukraine – were “quite scary and unpredictable”.

“What’s happening on the geopolitical front right now is the most important thing for the future of the world – freedom, democracy, food, energy, immigration,” he said.

 

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1 minute ago, Social Media said:

A global recession could be set in motion by the conflict in the Middle East as the humanitarian crisis compounds the challenges facing an already precarious world economy, two of Wall Street’s biggest names have warned.

Seems that no one told Biden that, as he eggs on israel in it's assault on Gaza while most of the world looks on in horror.