Be ready for stocks to stumble and recession to strike, Bridgewater’s co-chief investor says

• Don’t be surprised if stocks tumble and a recession takes hold, Greg Jensen says.
• Bridgewater’s co-chief investor says markets aren’t pricing in inflation and growth risks.
• Huge amounts of government spending have dulled the impact of interest-rate hikes, Jensen says.

Many investors are betting that inflation will fade, the Federal Reserve will slash interest rates, the US economy won’t skip a beat, and stocks will keep marching upward. They shouldn’t rule out a recession and a slump in asset prices, Greg Jensen has warned.

“My view is you end up with growth disappointing a bit and inflation disappointing on the high side a bit, ending up probably bad for bonds and probably a little bit bad for equities and generally weak growth,” the co-chief investment officer of Bridgewater Associates predicted during the latest episode of Bloomberg’s “Odd Lots” podcast.