Recession is coming.
That’s the growing consensus among economists and market prognosticators alike. It’s not hard to understand why they believe it. The yield curve, whose track record remains perfect in predicting economic downturns, has inverted to the greatest extent since before the financial crisis. Inflation is cutting into consumer spending and wrecking consumer confidence. Economic activity surveys are showing signs of slowdown, with Purchasing Managers Indexes at their weakest levels since the COVID recession. Housing activity has cratered under the weight of higher mortgage rates, and GDP printed 2 negative quarters earlier this year.