New Normal Could Plunge Economy into Recession

The big news from the Federal Reserve wasn’t the quarter point rate hike (which was expected). The big news was Fed chair Janet Yellen’s announcement of “balance sheet normalization.” Fed Chair Janet Yellen claims the central bankwill soon unwind its balance sheet. In plain English, the Fed claims it will begin selling off assets from its balance sheet, which remains bloated from previous Quantitative Easing programs. If “normalization” does actually proceed at full speed, it would entail $ 50 billion in financial assets per month being dumped into the market. Not even Fed officials know how markets will react to […]

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We Are Getting Very Close To An Inverted Yield Curve – And If That Happens A Recession Is Essentially Guaranteed

If something happens seven times in a row, do you think that there is a pretty good chance that it will happen the eighth time too?  Immediately prior to the last seven recessions, we have seen an inverted yield curve, and it looks like it is about to happen again for the very first time since the last financial crisis.  For those of you that are not familiar with this terminology, when we are talking about a yield curve we are typically talking about the spread between two-year and ten-year U.S. Treasury bond yields.  Normally, short-term rates are higher than […]

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How The Federal Reserve Is Setting Up Trump For A Recession, A Housing Crisis And A Stock Market Crash

Most Americans do not understand this, but the truth is that the Federal Reserve has far more power over the U.S. economy than anyone else does, and that includes Donald Trump.  Politicians tend to get the credit or the blame for how the economy is performing, but in reality it is an unelected, unaccountable panel of central bankers that is running the show, and until something is done about the Fed our long-term economic problems will never be fixed.  For an extended analysis of this point, please see this article.  In this piece, I am going to explain why the […]

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Why Donald Trump Needs The Next Recession To Start As Quickly As Possible

A new recession is coming, and Donald Trump needs it to begin sooner rather than later.  As I explained last week, most American voters tend to care about their pocketbooks more than anything else.  If the next recession were to officially start during the first quarter of 2017, it would be very easy for Trump to blame it on Obama, and then he could portray himself as the one that pulled the U.S. economy out of recession in time for the 2020 election.  But if the next recession does not begin until 2018 or 2019, everybody is going to blame […]

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Recession 2017? Things Are Happening That Usually Never Happen Unless A New Recession Is Beginning

Is the U.S. economy about to get slammed by a major recession?  According to Gallup, U.S. economic confidence has soared to the highest level ever recorded, but meanwhile a whole host of key economic indicators are absolutely screaming that a new recession is beginning.  And if the U.S. economy does officially enter recession territory in 2017, it certainly won’t be a shock, because the truth is that we are well overdue for one.  Donald Trump has inherited quite an economic mess from Barack Obama, and it was probably inevitable that we were headed for a significant economic downturn no matter […]

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We Are Being Set Up For Higher Interest Rates, A Major Recession And A Giant Stock Market Crash

Since Donald Trump’s victory on election night we have seen the worst bond crash in 15 years.  Global bond investors have seen trillions of dollars of wealth wiped out since November 8th, and analysts are warning of another tough week ahead.  The general consensus in the investing community is that a Trump administration will mean much higher inflation, and as a result investors are already starting to demand higher interest rates.  Unfortunately for all of us, history has shown that higher interest rates always cause an economic slowdown.  And this makes perfect sense, because economic activity naturally slows down when […]

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This Crash and Recession Indicator Warns: Extreme Danger

When it comes to spotting danger periods for recessions, and especially major crashes, the Boom/Bust Cycle lets us see when stock crashes and recessions are most likely to occur. As my fourth key macroeconomic cycle, this makes it the most important one I have innovated since the Generational Spending Wave in 1988. It explains why Ned Davis’ Decennial Cycle failed in 2010 – 2012, and why his cycle is more variable than clock-like. And right now it’s flashing a warning sign of extreme danger into 2019! What gives this cycle an edge is that it’s based on sunspot activity, and […]

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Global Recession? The Canadian Economy Shrinks At The Fastest Pace Since The Last Financial Crisis

Things have not been this bad for the Canadian economy since the last global recession.  During the second quarter of 2016, Canada’s GDP contracted at a 1.6 percent annualized rate.  That was the worst number in seven years, and it was even worse than most analysts were projecting.  This comes at a time when bad news is pouring in from all corners of the global economy.  While things in the United States are still relatively stable for the moment, the same cannot be said for much of the rest of the planet.  Canada in particular has been hit very hard […]

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Something Big That Always Happens Right Before The Official Start Of A Recession Has Just Happened

What you are about to see is major confirmation that a new economic downturn has already begun.  Last Friday, the government released the worst jobs report in six years, and that has a lot of people really freaked out.  But when you really start digging into those numbers, you quickly find that things are even worse than most analysts are suggesting.  In particular, the number of temporary jobs in the United States has started to decline significantly after peaking last December.  Why this is so important is because the number of temporary jobs started to decline precipitously right before the […]

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Undeniable Evidence That The Real Economy Is Already In Recession Mode

You are about to see a chart that is undeniable evidence that we have already entered a major economic slowdown.  In the “real economy”, stuff is bought and sold and shipped around the country by trucks, railroads and planes.  When more stuff is being bought and sold and shipped around the country, the “real economy” is growing, and when less stuff is being bought and sold and shipped around the country, the “real economy” is shrinking.  I know that might sound really basic, but I want everyone to be on the same page as we proceed in this article.  Just […]

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