What better company to serve up the true pulse of the global economy than a top consultancy like Korn Ferry.
When the economy is humming along, major corporations contract with Korn Ferry to find strong talent to hire and assess the health of their businesses. Korn Ferry, which boasts 106 offices in 52 countries, also helps companies land best-in-class executive talent and design benefits programs. But when the economy isn’t performing up to snuff, its consultant services that often get cut off first by many large companies to quickly slash costs.
That said, it’s unlikely bulled-up investors want to hear what Korn Ferry CEO Gary Burnison said on Yahoo Finance’s The First Trade Wednesday.
“Clearly there is a disconnect between the equity markets and what’s happening in economies around the world. I wouldn’t be surprised if the U.S. economy is only growing at 1%. That’s why you see central banks taking a much more accommodative stance,” said Burnison, who is in New York City to celebrate a new sponsorship deal with the PGA Tour.
Burnison has a good point on there being a disconnect.
Economic data in the U.S. has worsened over the past month as the trade war with China has taken hold. Wall Street is back to looking to a near-term earnings recession. And the Federal Reserve is likely on the cusp of lowering interest rates in a bid to jumpstart growth and inflation.
Meanwhile, the data pertaining to the European and Chinese economies have been nothing to write home about this past month.
Despite the mixed to negative data backdrop, stocks are back to flirting with their record highs. Something is off — either a blinded Mr. Market who loves cheap money from the Fed or the assessments of leading CEOs such as Burnison.
“The Chinese economy has been hurt — there is no question about that,” Burnison added. “And we are seeing that in our business in China as well. The other thing that’s out there that nobody talks about is Brexit, which is happening slowly and it’s not going to be resolved by Halloween.”
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