US recession odds rise
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2hon MSN
A Walmart-related recession indicator that's preceded the last 4 economic downturns is flashing red
The Walmart Recession Signal, a measure of Walmart's stock price relative to luxury stocks, has spiked leading up to the last four US downturns.
People are preparing themselves for the fact that we are already in a recession now or that there is a high likelihood we will soon be in one,” said Hady Farag, a partner and associate director at Boston Consulting Group.
Stock market bulls should show a little more caution, given how past oil price shocks have impacted the economy. Every US recession, excluding the COVID-19 pandemic, was preceded by an oil price shock,
Economists have pulled up their risk assessments of a contraction amid heightened uncertainty over geopolitical risk and a labor market slump.
There's good news and not-so-good news for investors right now.
Rising oil prices and a slowing labor market could be the two forces that drag the US economy into a downturn, Mark Zandi said.
Recession forecasts aren't always correct. But for now, it's wise to prepare your investments for a potential recession just in case.
Blame rising oil prices.
Currency concerns: Recessions can prompt aggressive government spending and stimulus measures, raising concerns about currency devaluation. Gold, which is priced in dollars but is not dependent on any government's promises, becomes more attractive under these conditions.
Several indicators suggest Australia might be heading for a recession - if not already in one - as oil shock from the Middle East crisis and interest rates smash consumer confidence.