Goldman Sachs Issues Stock Market Warning

U.S. investors are significantly underestimating the risk of a recession, potentially increasing the impact of a recession next year, economists at Goldman Sachs warned in a Monday research note, according to Bloomberg.

Researchers at Goldman estimate a 39 percent chance of a slowdown in U.S. growth, but risk assets only account for an 11 percent chance, Bloomberg reported. By underestimating the chance of a recession, investors are increasing their exposure to the effects of “recession scares” in 2023, the analysts warned.

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Poll: Small Business Owners Trust Republicans to Help Them Amid Recession Fears

Small business owners believe they’ll benefit from Republican victories in the upcoming elections, according to a new poll.

Most small business employers believe the country is in a recession, and fear that economic conditions will put them out of business, with a majority believing a Republican victory will help them, according to the survey conducted by Rasmussen and the Job Creators Network Foundation (JCNF). The poll reflects a broader concern among voters about economic conditions and historic levels of inflation under the Biden administration.

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Investors Show Concern over Defaulting Mortgages as Possible Recession Looms

Investors are reportedly concerned about mortgage defaults and are unloading Fannie Mae and Freddie Mac securities, amid record-high interest rates and a rapidly cooling housing market. 

Mortgage rates last week hit a two-decade high of 6.92%, a trend that has slowed the booming, often over-priced real estate market during the height of the pandemic.  

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Expect Layoffs and a Recession If Fed Doesn’t Let Up, Bank of America Exec Warns

If the U.S. Federal Reserve continues its policy of aggressive interest rate hikes, the U.S. could lose hundreds of thousands of jobs, spiking unemployment, according to a Bank of America analysis, CNN reported.

Bank of America’s Chief U.S. Economist Michael Gapen expects roughly six months of relatively high unemployment and a”mild recession,” as the Fed’s aggressive interest rate hikes blunt consumer demand, he told CNN Monday. However, Gapen also noted that the typical bounceback seen after a recession might be delayed if the Fed, which has been incredibly hawkish on interest rates, refuses to reduce rates.

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Commentary: Federal Reserve’s False Assumptions Push the Economy into Recession

Federal Reserve

Based on its assumptions, the Federal Reserve is doing everything right by raising interest rates rapidly after years of easy money. It will certainly succeed in its goal of “cooling down” the economy.

Unfortunately, the Fed’s basic assumptions are wrong, and it has already begun reducing Americans’ standard of living, as indicated by this week’s Commerce Department report showing the nation’s gross domestic product fell for the second quarter in a row, meeting the common definition of a recession.

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Biden Has 38 Percent Approval in New Poll; 61 Percent of Likely Voters Say We’re in a Recession

Joe Biden’s approval rating is holding steady at 38 percent in the latest poll conducted by Insider Advantage for the Center for American Greatness. The national survey of 800 likely voters showed that 60 percent of respondents disapproved of Biden’s job performance, and 5 percent had no opinion or were undecided.

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Commentary: Amid Recession Fears, Economically Free States Continue to Outperform

Florida Gov. Ron DeSantis recently responded to questions about California Gov. Gavin Newsom’s ads airing in Florida, “It’s almost hard to drive people out of a place like California given all their natural advantages, and yet they are finding a way to do it.” He noted that California is hemorrhaging its population because of bad progressive economic policies so that they could be more free

Florida ranks third in the nation for economic freedom, according to the Fraser Institute. And California ranks second to last.

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‘It’s An Absurd Argument’: Economists Take Apart One of Biden’s Favorite Talking Points

The Biden administration’s oft-touted talking point that employment has boomed under the administration is misleading and instead simply a natural recovery from pandemic losses, economists told the Daily Caller News Foundation.

Facing consecutive quarters of negative gross domestic product (GDP) growth, sky-high inflation and plummeting consumer sentiment, the Biden administration has routinely cited a low unemployment rate and strong on-paper jobs creation as positive results of President Joe Biden’s economic stewardship. But the notion that these figures represent booming job creation is misleading since the economy has merely rebounded by adding back jobs that were lost during the pandemic and has still yet to reach pre-pandemic levels, economists told the DCNF.

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The Fed’s Preferred Inflation Metric Just Surged in Another Warning Sign for the Economy

The Federal Reserve’s preferred inflation gauge, the Personal Consumption Expenditures (PCE) price index, continued to surge in June, according to data released Friday by the Bureau of Economic Analysis (BEA).

The PCE index was up 6.8% for the year ending in June, an increase from the 6.3% that it was at in both April and May, the BEA announced. PCE is the Fed’s preferred measure of inflation because it is “just better at capturing the inflation people actually face in their lives,” and the central bank endeavors to keep it at 2%, Federal Reserve chair Jerome Powell said Wednesday.

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Biden Administration Accused of Gaslighting Nation with ‘Soviet Level Propaganda’ After Attempting to Redefine Recession

by Debra Heine   The White House is being accused of gaslighting the American people with “Soviet levels of propaganda” as Biden officials attempt to change the definition of recession amid economic data that shows the United States is entering into a recession. A recession is traditionally defined as two…

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Commentary: Historical Recession Signals Are Flashing Red

Unemployment insurance continuing claims increased by 122,000 on a non-seasonally adjusted basis from July 2 to July 9 to 1.45 million, the latest U.S. Department of Labor data shows, as multiple historical recession signals are flashing red.

The number comes as initial unemployment claims have continued ticking upward on both on a seasonally adjusted basis. Since mid-March, when weekly claims hit a low of 166,000, now they are up over 251,000.

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Economist: 30 Percent Chance That U.S. Enters a Recession Within a Year’s Time

A Goldman Sachs economist says there is a 30% probability of the U.S. entering a recession within one year and 48% within two years. 

Goldman Sachs Chief U.S. economist David Mericle outlined the probability of a recession at an event Tuesday and said that the likelihood of a recession would decrease if the U.S. had not entered one within two years.

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Federal Reserve Chair Powell Says During Senate Hearing That a Recession Is Possible

Federal Reserve Chair Jerome Powell said the U.S. could enter into a recession when questioned Wednesday during a Senate Banking Committee hearing.

Confronted about 40-year-high inflation and the Fed raising interest rates in response, Powell said he couldn’t know for sure but said a recession, defined as a significant decline in economic activity over time, is possible.

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Recession Worries Rising Among Economists

Recession worries are rising among economists as inflation continues at high levels.

A top Moody’s economist has predicted a recession could hit within the next two years, but others are saying it could happen sooner.

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Commentary: A Biden Recession Is Virtually Guaranteed After 10-Year, 2-Year Treasuries Spread Inverts as Economy Overheats from Rampant Inflation

Joe Biden

The spread between 10-year treasuries and 2-year treasuries, a leading recession indicator whose inversions have predicted almost all of the U.S. economic recessions in modern history, on March 31 inverted for the first time since Sept. 2019.

When the 10-year, 2-year spread inverts, a recession tends to result on average 14 months afterward, sometimes sooner, sometimes later. The one time there was a head fake on the 10-year, 2-year was in the mid-1990s at a time when inflation was much lower Visit Site than it is now.

As an aside, potentially the Sept. 2019 inversion might have ended up being a premature indicator, too, but then Covid and global economic lockdowns in early 2020 went ahead and ensured a recession even if one was not due. On the other hand, at that point it had been 11 years since the prior recession and so the business cycle was going to end sooner or later.

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Commentary: Seven Major Failures of the Biden Presidency

Joe Biden

With President Joe Biden set to deliver his first State of the Union address on Tuesday night, it’s a good time to ask: How has Biden done as president and what is the actual state of our union?

According to the American people, things aren’t going great.

A CNN poll in early February asked Americans what they thought of Biden’s presidency and what he’s done right since entering office Jan. 20, 2021.

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