The Julia La Roche Show
#144 David Rosenberg: Recessionary Forces Are Building And The Economy Is Weaker Than The Narrative Suggests
Feb 15, 2024
Economist David Rosenberg shares his recession call and highlights the weak economy. He discusses the impact of interest rates and divergences in economic indicators. Rosenberg is bullish on bonds and reveals how to make a 20% return. The guest reflects on Bob Farrell's influence and emphasizes diversification in investments.
01:01:43
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Quick takeaways
- The economy is weaker than the narrative suggests, with underlying weaknesses such as divergences in data and long lags of interest rate impacts.
- Considering leading indicators in recession calls is crucial, as historical data shows that a Fed tightening cycle beyond an inverted yield curve has always led to a recession.
Deep dives
Economic picture doesn't look great, says David Rosenberg
David Rosenberg explains why the economic picture doesn't look great, highlighting divergences in the data and the long lags of interest rate impacts. He points out non-recurring factors that supported the economy, such as a drawdown in savings and fiscal stimulus, which will not be present this year. He remains in the recession camp, expecting a recession to occur later this year, albeit with uncertain timing. He also shares his bullish call on bonds, predicting a 20% total return due to declining interest rates and the powerful price appreciation of long-duration bonds.
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