Hedge fund manager and investor Mitchell Feierstein warned Wednesday that Americans should brace for a volatile stock market in 2026, even as interest rates begin to fall and some economic conditions improve under President Donald Trump’s policies.
Feierstein indicated the Federal Reserve is likely to cut interest rates multiple times next year, stating, “I think next year we’re going to see two to three interest rate cuts, at least.”
However, he cautioned that markets would experience significant volatility, with stocks potentially declining sharply in early 2026.
The analyst criticized the Federal Reserve’s current dysfunction, arguing that the central bank has strayed from its dual mandate of price stability and full employment. Feierstein noted that recent market performance contradicts many economists’ forecasts, highlighting dramatic gains in commodities such as gold (65%) and silver (140%) over the past year.
He also pointed to inflated job numbers during the Biden administration and wages failing to keep pace with inflation, citing a cumulative inflation rate of 27% during that period. “Wages were nowhere near that,” Feierstein said, adding that inflation outpaced earnings by multiples.
Despite acknowledging signs of improvement including lower inflation and stronger economic growth, Feierstein emphasized that recovery would take time. He urged Americans to monitor the 10-year Treasury yield as it is expected to fall with interest rate cuts, which could ease borrowing costs for mortgages, credit cards, and business loans.
“This is the way forward for 2026,” Feierstein stated, “but the markets will have volatility.”
