Newsmax Finance Insider and renowned economist Larry Kudlow told
Newsmax TV that investors must remain calm, cool and collected despite the recent nerve-rattling stock market volatility.
"Don't get too bearish right now," Kudlow, a senior contributor at CNBC, said Thursday on "The Steve Malzberg Show."
Investors have been jittery as stocks plunged this week and markets got off to their worst four-day start to a year and economists slashed fourth-quarter U.S. growth estimates amid a China-led rout that continued to engulf markets around the globe.
The market is on pace for its worst week since August. The Standard & Poor's 500 index has fallen 4.8 percent this week and the Nasdaq is in a six-day skid.
"The stock market was spooked by the drop in the Chinese currency, the yuan, but let me just tell you this. The government of China is not doing this. The [U.S.] market is doing this."
Kudlow also agrees with Donald Trump that America's economy is held hostage by China.
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"There's a lot of capital flight from China because their economy is lousy and their government is not making sufficient pro-market reforms. So what you're seeing here is people are getting out of China and that's a new sight," Kudlow explained. "It started by the way last summer, it's probably going to continue some more and it's going to damage Chinese economy," he said.
As far as his advice to U.S. investors, he urged calm, reasoning and common sense.
"We're not going into a recession, we're not going into a stock market crash, we're not going into a banking crash," he said. "We can do a lot better than this."
(Newsmax wire services contributed to this report).
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