Wall Street strategist dismisses GDP report, says small businesses are being ‘garroted’ by Federal Reserve and near bankrupt

The veteran market watcher is famous for his bearish disposition. Over the past two years, he’s been one of the key voices warning that the Federal Reserve’s rapid interest rate hikes will ultimately spark a U.S. recession. Even after the latest GDP estimate for the third quarter came in red hot this week, Edwards remained cautious.

He believes that America’s small businesses are struggling with the rising cost of borrowing and persistent inflation and their problems will eventually come to the surface. And rising small business bankruptcies will ultimately be the final nail in the coffin of the U.S. economy after years of headwinds and recession predictions. “The vast majority of economists are stampeding away from their recession calls,” he wrote in a Thursday note. “The notion that we are at the start of a new economic cycle seems preposterous to me.” Edwards laid out his reasoning, particularly emphasizing the role of the “7 Fed Horseman of the Apocalypse,” implicitly comparing the interest-rate hikes from Jerome Powell and his six fellow Federal Reserve board members to the Old Testament’s destruction myth.

“You only need to turn your gaze to the smaller listed and unlisted companies to witness the torture being inflicted by the Fed’s interest rate garrotting,” he wrote. 

The…