UBS CEO Sergio Ermotti on market volatility: Don't see any path of normalization in the future

Summary

UBS CEO Sergio Ermotti discussed market volatility, geopolitical risks, and client positioning with Squawk Box. He said he does not see any near-term normalization to lower volatility and that investors should hold cash given few attractively priced assets. He also commented on credit-card rate caps, inflation, U.S. economic tailwinds, and blockchain's future in traditional banking.

• Ermotti sees elevated market volatility persisting absent resolution of trade, tariff, Greenland, Ukraine, and other geopolitical issues.
• He says clients are diversifying and retaining cash because almost every asset class looks fairly priced or overpriced.
• He agrees with the view that cash is king and sees it as dry powder for dislocations.
• He is skeptical of credit-card rate caps as long-term intervention in free markets.
• He notes the U.S. economy has tailwinds from AI investment, deregulation, and tax stimulus, but inflation is not fully under control.
• He believes blockchain and tokenization will converge with traditional banking, though tokenization safety still needs proof.