On The Market

172: The “Rolling Recession” Has a New Target in 2024 w/Liz Ann Sonders

Dec 28, 2023

Liz Ann Sonders, Chief Investment Strategist at Charles Schwab, discusses the concept of a rolling recession and the potential implications for different sectors of the economy. She analyzes the labor market and predicts a possible uptick in unemployment rate in 2024. The podcast also explores the impact of rate hikes on the economy and the indicators used to predict recessions.

39:00

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Liz Ann Sonders

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Quick takeaways

The concept of a rolling recession, where different sectors experience ups and downs at different times, can prolong economic pain but also has some positive aspects compared to a deep and sudden recession.

Understanding the relationship between bond yields and stock prices is crucial as stock markets are influenced by changes in the bond market.

Deep dives

Key Points: Liz Ann Saunders' report and conversation on US Outlook

In a recent report called US Outlook, Liz Ann Saunders, Chief Investment Strategist at Charles Schwab, discusses her team's insights on the economy for the next year. She talks about the concept of a rolling recession, where different sectors experience ups and downs, and explains the impact of factors like monetary and fiscal stimulus, mortgage rates, bond yields, consumer spending, and sentiment. Saunders also emphasizes the importance of paying attention to the right economic indicators and understanding their significance for making investment decisions. She suggests that the health of the labor market and inflation will be key factors for the Federal Reserve to consider when deciding on future rate cuts.

Introduction

5min

The Concept of a Rolling Recession

14min

Thorough Analysis of the Labor Market and Sponsor Ads

3min

Funding Investment Properties and Understanding Long and Variable Lags in Monetary Policy

4min

Indicators and Predictions

12min

Discussion with Lizanne about her work and an ad for BiggerPockets agent finder

3min

Americans have been waiting for a recession to kick in for the past year. With consumer sentiment down and debt piling up, it’s understandable why so many feel like the worst is yet to come. But what if the “hard landing” everyone was so afraid of already happened without us even noticing it? Could a “rolling recession” be why the economy never crashed at once? We’ve got Liz Ann Sonders, Charles Schwab’s Chief Investment Strategist, on the show to explain.

In a new report, Liz Ann touches on the one industry that could get hit hardest in 2024, what will happen if the labor market starts to break, and why we aren’t out of the woods yet for another recession. In today’s show, she’ll detail her findings and explain why SO many Americans feel now is an economically dangerous time, even while hard data points to confident consumers.

We’ll get Liz Ann’s take on the Fed rate cuts and whether or not they’ll even happen as the Fed eagerly awaits mortgage rate hike effects to finally kick in. Plus, recession indicators to watch in 2024 and why the bond markets could be pointing to something that no one else has been able to see.

In This Episode We Cover:

The “rolling recession” and why a “hard landing” may have already hit

One industry that could get hit HARD in 2024 if the labor market starts to weaken

Why we haven’t felt the full effect of the Fed’s rate hikes yet

Fed rate cut predictions and how long the Fed could continue to hold high rates

Recession indicators and what the bond market tells you that no one else is talking about

And So Much More!

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