Thoughtful Money with Adam Taggart Will A Market Correction Trigger A Recession? | Cameron Dawson
Feb 18, 2025
Cameron Dawson, Chief Investment Officer at NewEdge Wealth, returns to share her sharp insights on market dynamics. She discusses the potential impacts of a declining stock market on U.S. consumer spending and the intricate relationship between inflation and GDP growth. Dawson delves into the risks associated with high yields and the significance of leveraging ratios in corporate profits. With a focus on asset allocation strategies and the role of alternative assets, she emphasizes turning market volatility into opportunity while navigating economic uncertainties.
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Market Selloff Risk
- High equity allocations make households sensitive to stock market fluctuations.
- A market selloff could trigger reduced consumer spending and a negative feedback loop.
Global Economy Assessment
- The global economy remains resilient, with no US recession predicted for 2025.
- Factors like tight labor market, capital expenditure cycle, and positive real GDP growth contribute to this resilience.
Inflation Dynamics
- Inflation stickiness depends on exogenous (e.g., oil shocks) vs. endogenous (economic overheating) factors.
- While wages and rents seem stable, exogenous shocks like tariffs could embed inflation.