Monetary Matters with Jack Farley
Not Backing Down On Recession Call | David Rosenberg on Wealth Effect, Uncle Sam, and Stock Market Price Bubble
Oct 28, 2024
David Rosenberg, founder of Rosenberg Research & Associates Inc., shares his economic insights and forecasts a recession by 2025, citing low savings rates and inflated consumer spending. He critiques the disconnect between GDP growth and economic reality, emphasizing unrealistic stock market valuations. Rosenberg discusses the potential for a stock market price bubble and the risks of passive investing. He also highlights emerging market opportunities and the bullish trend in gold, as central banks shift reserves toward the precious metal amid recession concerns.
01:10:30
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Quick takeaways
- David Rosenberg emphasizes the likelihood of a recession by 2025, driven by low savings rates and a stock market bubble.
- The discrepancy between GDP growth and survey data highlights hidden economic weaknesses masked by government fiscal policies and deficits.
Deep dives
Divergence in Economic Indicators
The current state of the U.S. economy presents a perplexing disconnect between survey data and GDP numbers. While government data suggests robust growth at around 3%, survey data from private sectors indicates a more modest expansion of approximately 1.5%. This discrepancy raises questions about the true health of the economy, especially as recent reports show significant parts of the economy in stagnation or contraction. Surveys, including the Beige Book, echo concerns typical of previous recessions, challenging the prevailing narrative of economic exceptionalism.
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