FedEx Chairman and CEO Fred Smith expressed extreme pessimism about the global economy on the delivery giant’s post-earnings conference call with analysts.
“This is the most dispiriting call about the economy I’ve heard in a very long time,” CNBC’s Jim Cramer said Wednesday. Smith was “basically implying that we’re going to import that slowdown,” the “Mad Money” host added.
Shares of FedEx plunged about 14% on Wednesday after the company late Tuesday blamed the U.S.-China trade war and the loss of Amazon as a customer for its quarterly earnings and revenue misses. FedEx also lowered full-year guidance for fiscal 2020.
On the call with analysts, Smith said, “I think there is a lot of whistling past the graveyard about the U.S. consumer and the United States economy versus what’s going on globally.”
“U.S. business is so dependent upon exports and trade. And when you have your two biggest trading partners kind of frozen between the NAFTA rewrite and China trade, it shouldn’t be a surprise to anybody that business investment starts slowing down. And that’s exactly what we’re seeing,” Stephenson said, adding business investment is “flashing yellow.”
“I don’t think we’re headed to a recession, but we’re definitely slowing down,” Stephenson said. “You can’t have that kind of slowdown in business investment and not find its way into the consumer ultimately.”